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HDB to trim supply of BTO flats this year

SINGAPORE — The supply of Build-to-Order (BTO) flats this year will be slightly reduced from 17,000 flats to about 16,000 flats, the Housing and Development Board (HDB) said on Monday (July 2) as resale prices rose for the first time after falling for six consecutive quarters.

HDB’s flash estimate showed that HDB resale prices edged up 0.1 per cent in the second quarter, compared to the previous three months.

HDB’s flash estimate showed that HDB resale prices edged up 0.1 per cent in the second quarter, compared to the previous three months.

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SINGAPORE — The supply of Build-to-Order (BTO) flats this year will be slightly reduced from 17,000 flats to about 16,000 flats, the Housing and Development Board (HDB) said on Monday (July 2) as resale prices rose for the first time after falling for six consecutive quarters.

HDB’s flash estimate showed that HDB resale prices edged up 0.1 per cent in the second quarter, compared to the previous three months. The HDB resale price index had fallen by 0.8 per cent in the first three months of the year.

Year-on-year, the resale prices fell 1.5 per cent in the second quarter, compared to the same period last year.

Calling the decision to trim the supply of BTO flats a “rational decision”, ERA key executive officer Eugene Lim noted that the projects have not been heavily subscribed, which is an indication that the demand has been met.

During the most recent BTO exercise held in May for example, there were a total of 6,583 applications received for 3,015 three-room or larger flats. These were spread across four projects in Sengkang, Yishun, Tampines and Toa Payoh. This translates to about two applications vying for one unit, on average. 

The subscription rate was similar for an earlier exercise in February, where a total of 7,270 applications were received for 3,007 three-room or larger flats in projects at Choa Chua Kang, Woodlands, Geylang and Tampines.

In the first half of the year, HDB had put up 11,373 flats for sale, including 7,634 BTO flats, as well as 3,739 units offered under the Sales of Balance Flats and Re-offer of Balance Flats exercises. Next month, it launch another 4,300 BTO flats in Punggol and Yishun.

The HDB launched 17,584 BTO flats last year, compared to 17,891 in 2016 and 15,100 in 2015.

On the slight reduction in supply this year, the HDB noted that the public resale market “continues to stabilise”.

The analysts were split on whether HDB resale prices have bottomed out after 18 months of decline.

Mr Lim felt that “things are looking up” in the HDB resale market, with optimism in the private property market spilling over into the HDB resale market.

But Mr Nicholas Mak, executive director of ZACD Group, said it was too early to tell, and it would require two consecutive quarters of increase to confirm that the market has turned the corner.

The analysts expect prices to stabilise, with any changes in the second half of this year to be gradual. 

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