Even Pricey Flats In Great Demand

Source : The Straits Times, Sep 30, 2008

HDB BALLOTING EXERCISE

Pinnacle draws 3 times more applications than the number of flats

THEY are among the priciest flats ever launched by the Housing Board, but there has been no shortage of potential buyers.

The 50-storey Pinnacle@Duxton in Tanjong Pagar has attracted 1,467 applications for the 428 four- and five-roomers on offer - that is about 3.5 hopefuls for each unit.

Cheaper homes in less central areas were in even more demand, with applications streaming in at a rate of 20 per new flat in some districts.

HDB's balloting exercise on Friday attracted a total of 4,463 applications for 992 flats on sale in Ang Mo Kio, Queenstown, Jurong West, Kallang/ Whampoa and Tanjong Pagar as of 5pm yesterday.

The 111 five-roomers at the Pinnacle start at $545,000 and hit $645,800 for a 49th storey unit - the most expensive new HDB flats - yet there were still 372 applicants.

Demand for those flats paled in comparison with the 762 applications for just 39 four-room flats in Kallang/Whampoa, priced at between $364,000 and $435,000.

Property analysts said the response was not surprising, considering the underlying demand for new flats from first-time buyers and the preference for cheaper units.

Still, the fact that the Pinnacle racked up more than three times more applications than flats available proves there is strong demand, said PropNex chief executive Mohamed Ismail.

'Buyers have to expect to pay a premium for the prime location of city flats,' said Mr Ismail.

The HDB said the prices of Pinnacle flats were still lower than those of resale flats in the area. HDB figures show five-room flats in Tiong Bahru's Jalan Membina recently selling for $670,000 above the 20th floor. The average price of a five-room flat sold in Jalan Membina and Cantonment Close over the last three months was $624,000.

The response to the ballot also highlighted another emerging hot spot - Jurong, an area once spurned by buyers for being too far from the city.

Five-room flats here were about 11 times oversubscribed - 335 applications for the 30 flats.

ERA Asia-Pacific's assistant vice-president Eugene Lim said new flats here are now more attractive after a masterplan to rejuvenate the area was announced recently.

'It's also currently one of the cheapest housing spots in Singapore. It's not surprising it's moving now,' said Mr Lim.

He also feels those priced at $650,000 are at the top end of what buyers can afford.

'With two incomes, it's still manageable,' he said. In many cases, these flats are cheaper than buying from the resale market, where buyers usually need to pay a cash component upfront to sellers. This is not required for new flats, he added.

Still, HDB 'should be conscious that such pricing of flats are affordable only to a small cross-section of HDB home buyers,' said Mr Ismail.

But the true popularity of the flats has yet to be seen as the number of applications might not reflect the actual take-up rate. Applications for the new flats close on Oct 9.