November 2022 BTO exercise sees lower application rates

The highest application fees in the November BTO exercise were documented for the three- and four-room condos under the Prime Location Public Housing (PLH) Model undertaking in the mature Kallang/Whampoa real estate. 4,561 applications were gotten for the 405 four-room condos readily available, which works out to an application rate of 11.3. For the three-room condos, 550 applications were obtained for the 72 units started, translating to a 7.6 application rate.

Apart from the Kallang/Whampoa PLH condos, condos in Queenstown, which include both PLH including non-PLH units, were also prominent among applicants, points out Lee Sze Teck, higher supervisor, research study at Huttons Asia.

From a supply perspective, the number of BTO units introduced this year jumped by 35.5% y-o-y to 23,184 units, while SBF units released slipped 29.6% y-o-y to 3,023 units. Completely, units introduced in 2022 totalled 26,207 condos, up 22.5% y-o-y.

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From a full-year point of view, OrangeTee & Tie’s Sun highlights that the total variety of applicants for all BTO as well as SBF sales exercises this year appeared at 167,119, 16.3% greater than the 143,706 candidates recording in 2021. In terms of BTO release, the number of applicants increased by 22.6% y-o-y in 2022 to 117,251, while the number of SBF applicants increased by 3.7% y-o-y to 49,868.

The November 2022 Build-To-Order (BTO) sales exercise finalized on Dec 2 with 24,562 applications obtained, according to data launched by HDB. HDB is providing 9,655 apartments available for sale under the exercise, accomplishing the biggest offering to day for an individual open.

However, OrangeTee & Tie’s Sun highlights that PLH apartments in Kallang/ Whampoa were a lot more prominent than those in Queenstown, perhaps because of their better proximity to the downtown core. “This indicates that there can be a few purchaser reluctance if the boundaries of PLH model condos are pressed as well much inland, plus not every person is happy to trade a further place for a lengthy minimum occupation duration,” she follows.

The variety of applications received works out to a total application fee of 2.5. This is lower than the 7.8 application rate enrolled for the August 2022 BTO sales exercise, when 39,136 applications were acquired for 4,993 debuted flats.

Sun attributes the lower number of applicants to a few reasons, consisting of purchaser demand being drawn away to the Sale of Balance Flats (SBF). Citing information released by HDB, she mentions that 25,350 applications were obtained for the 1,071 SBF units readily available in the November sales exercise, equating to an application rate of 23.7. According to Sun, the more powerful demand for SBF units points to an inclination by buyers for apartments with a shorter completion duration. “Almost all SBF condos might be finished quicker than freshly opened BTO apartments in the very same neighborhood because they are released in earlier stages,” she mentions.

Christine Sun, top vice president of research study and analytics at OrangeTee & Tie, mentions that the variety of applications in November dropped by 37.2% contrasted to the August exercise. “This is the most affordable total BTO application price from September 2019 with an application ratio of 2.1,” she emphasize.

Amongst the non-mature estates in the release, which comprises Bukit Batok, Tengah as well as Yishun, five-room condos in Tengah viewed the highest rate of interest, with 2,849 applications received for the 670 units offered, or an application price of 4.3. Huttons’ Lee connects this to customers pursuing much bigger units, which give additional flexibility to accommodate hybrid job as well as home-based training events. “Tengah has actually consistently brought in several applicants for its sustainability theme and distance to major work centres in Jurong East Regional Centre and also Jurong Innovation Area,” he includes.

Other factors for the lower BTO applications may include the cooling measures that came into impact on Sept 30. According to Sun, some purchasers may be expecting rates in the resale market to fall, also are hence holding back on acquiring a BTO flat just to acquire a finished home in the secondary market.

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