Shift in focus because demand from singles remains high, at 27.1 times
[SINGAPORE] The supply of larger Housing and Development Board flats will be cut back by about 18 per cent while the number of two-room flats will be doubled in the coming year, as HDB transitions to a more sustainable Build-To-Order (BTO) flat supply.
Providing a breakdown yesterday, HDB said it will reduce the supply of new three-room and larger flats from 22,600 units in 2013 to about 18,600 next year.
The shift in focus is in view of the fact that demand from singles remains high, at 27.1 times at the latest November exercise, albeit a big drop from 57.5 times in July, as shared by National Development Minister Khaw Boon Wan in an earlier blog post.
For families, the average BTO application rate has come down steadily from 2.4 in January to 1.3 in November, while the second-timer application rate too has fallen significantly, from 14.9 in January to 2.7 in November.
Overall, the average BTO application rate has dropped from 5.3 times in 2010 to 3 times in 2013. Of this, the average first-timer application rate has eased to 1.7 times in 2013, while the average second-timer application rate has fallen to 7.1 times in 2013.
The 2014 BTO flat supply plan - in total, HDB will offer 24,300 flats in 2014, about 3 per cent less than the 25,100 launched this year - will allow HDB to start transiting from the ramped-up phase to a more sustainable phase, said HDB, emphasising that priority will continue to be given to housing families.
About 70 per cent of three-room BTO units in non-mature estates will be set aside for first-timer families, for instance, and 85 per cent of four-room and five-room flats. And while the planned supply of 18,600 larger flats sounds like a drastic cut, it exceeds the estimated 15,000 new Singaporean family formations for the year.
Beyond protecting first-timer families, HDB can consider allocating more flats to second-timers, suggested Nicholas Mak, executive director at SLP International.
"If the average first-timer application rate has eased to 1.7 times in 2013, and according to Mr Khaw, when the BTO application rate is two or lower, all the applicants will have a chance to select their flat, HDB should consider allocating more flats to non- first-time applicants because their BTO application rate is still much higher than that of first-timers," said Mr Mak.
Separately, to meet demand from singles, HDB will allocate any remaining two-room flats from the supply set aside for families to singles, in addition to nearly doubling the supply of two-room flats.
While this will help soak up some demand, rates of BTO applications from singles will likely remain in the double digits in 2014, said Mr Mak.
"I hope that, one day, when demand from families for three-room flats is largely satisfied, singles will be allowed to apply for three-room BTO flats," he said. "I think such a move will be welcomed by many singles."
Two-and-a-half years on, the ramped-up BTO programme is beginning to show results, said Mr Khaw on his blog yesterday.
Marking the end of "a productive year", Mr Khaw noted that 13,600 new flats were completed this year, with keys handed over to their proud owners.
"Next year, we will see greater results of this ramped-up programme, when we complete more than 28,000 new flats. That is more flats than the entire Clementi Town," he said.
Source from Business Times