November 2022 BTO exercise sees lower application rates
The November 2022 Build-To-Order (BTO) sales exercise finalized on Dec 2 with 24,562 applications received, according to data released by HDB. HDB is supplying 9,655 flats for sale under the exercise, making it the largest offering to date for a single open.
The number of applications got works out to an overall application rate of 2.5. This is less than the 7.8 application price enrolled for the August 2022 BTO sales activity, when 39,136 applications were received for 4,993 launched flats.
Nevertheless, OrangeTee & Tie’s Sun highlights that PLH apartments in Kallang/ Whampoa were a lot more preferred than those in Queenstown, perhaps as a result of their better closeness to the midtown core. “This shows that there could be some buyer resistance if the boundaries of PLH model apartments are pressed as well much inland, also not everyone is willing to trade an additional location for an extensive minimum line of work time frame,” she observes.
From a full-year point of view, OrangeTee & Connection’s Sun highlights that the overall number of candidates for all BTO and SBF sales exercises this year appeared at 167,119, 16.3% more than the 143,706 applicants logged in 2021. In regards to BTO open, the number of applicants boosted by 22.6% y-o-y in 2022 to 117,251, while the amount of SBF applicants raised by 3.7% y-o-y to 49,868.
Apart from the Kallang/Whampoa PLH apartments, flats in Queenstown, that include both PLH including non-PLH units, were likewise preferred among clients, mentions Lee Sze Teck, higher director, study at Huttons Asia.
Christine Sun, senior vice president of research study and even analytics at OrangeTee & Tie, notes that the variety of applications in November slipped by 37.2% compared to the August exercise. “This is the lowest overall BTO application price since September 2019 with an application ratio of 2.1,” she highlights.
Among the non-mature estates in the release, which comprises Bukit Batok, Tengah as well as Yishun, five-room condos in Tengah observed the greatest rate of interest, with 2,849 applications received for the 670 units readily available, or an application premium of 4.3. Huttons’ Lee attributes this to buyers looking for larger units, which provide even more versatility to suit combination job also home-based training activities. “Tengah has actually regularly drawn in several clients for its sustainability style and even distance to significant employment facilities in Jurong East Regional Centre and Jurong Innovation District,” he adds.
From a supply standpoint, the range of BTO units introduced this year jumped by 35.5% y-o-y to 23,184 units, while SBF units introduced slipped 29.6% y-o-y to 3,023 units. Completely, units introduced in 2022 amounted to 26,207 apartments, up 22.5% y-o-y.
Sun connects the reduced amount of applicants to a few causes, featuring customer interest being sidetracked to the Sale of Balance Flats (SBF). Citing information released by HDB, she mentions that 25,350 applications were acquired for the 1,071 SBF units offered in the November sales exercise, converting to an application rate of 23.7. According to Sun, the more powerful demand for SBF units points to a choice by customers for condos with a much shorter completion period. “Most SBF condos may be finished faster than recently opened BTO apartments in the very same neighborhood given that they are released in early phases,” she says.
Some other reasons for the lesser BTO applications may consist of the cooling measures that came into result on Sept 30. According to Sun, some customers may be expecting costs in the resale market to fall, also are thus holding off on buying a BTO flat in order to get a completed home in the second market.
The greatest application prices in the November BTO exercise were captured for the 3- and four-room apartments under the Prime Location Public Housing (PLH) Model project in the developed Kallang/Whampoa estate. 4,561 applications were obtained for the 405 four-room condos available, which works out to an application rate of 11.3. For the three-room apartments, 550 applications were obtained for the 72 units released, translating to a 7.6 application rate.