9,901 Applications Pour In For Just 278 Flats

Source : The Straits Times, Feb 19, 2008

ALMOST 10,000 people have applied for just 278 surplus flats being offered for sale by the Housing Board in keenly sought-after mature estates such as Toa Payoh, Tampines and Bedok.

By 5pm yesterday, ahead of the midnight deadline, 9,901 applications had been lodged - or 36 homeseekers for every flat available. This is the highest subscription rate recorded so far for such sales exercises.

A computer ballot will determine the order in which applicants get to pick a flat. The results will be out on Feb 21.

Most of the surplus flats offered in this batch are already completed, with the rest expected to be ready by 2011. Property consultants had expected a flood of applicants as buyers are increasingly being turned off by high asking prices in the HDB resale market.

Resale prices of HDB flats rose 17.5 per cent last year, while the median cash-over- valuation (COV) amount paid in transactions rose to $22,000 in the October to December quarter last year, compared with $17,000 in the previous quarter.

The surplus flats also appeal to buyers not wanting to wait three to four years for the HDB’s build-to-order flats, which are being offered in great numbers this year. About 4,500 will be offered from January to June alone.

The 278 surplus flats offered in this launch are located in highly coveted mature towns surrounded by amenities. Most are four-room flats, while 84 are five-room and executive units.

With its latest offer, the HDB’s stock of surplus flats will be whittled down to about 2,000.

In a statement yesterday, the HDB urged unsuccessful applicants to book a unit under its build-to-order scheme. Given that the take-up rates for the past four build-to- order exercises in Punggol and Sengkang have ranged from 65 per cent to 94 per cent, there was still a selection of flats left over.

It said: ‘On average, only one in two applicants invited on the first day of the selection exercises actually booked a flat, despite having a wide range to choose from.’

It also suggested that couples book their flats before getting married under the fiance-fiancee scheme to reduce the waiting time for their flats. Those already married can consider living with their parents or renting a room of a flat on the open market while waiting for their flats to be completed, it said.

Resale flats, meanwhile, were still ‘affordable’. The HDB said that a quarter of transactions last month were completed at prices not exceeding $10,000 above the flats’ valuations. These includes flats sold in established towns such as Ang Mo Kio, Bedok and Tampines.

According to Mr Eric Cheng, executive director of HSR property group, sellers are asking for about 10 per cent less in COV amounts compared with the fourth quarter of last year. Buyers, he said, were adopting a wait and see attitude.

The HDB said earlier this month that it was conducting a review of its year-old sales exercises. Chairman of the Government Parliamentary Committee on National Development and Environment, Mr Charles Chong, suggested that the board fine-tune the system to allay fears of young homebuyers who continually fail to get a flat in ballots.

‘There should be some predictability - for example, if I apply (for a unit) now, I can get my flat one or two years down the road,’ he said.