Government to strike a balance in HDB market

With the resale HDB flat market holding firm and prices of resale flats still high, the government has promised to look into shortening the wait for new HDB flats while monitoring the effect of exorbitantly-priced resale flats especially in the downtown areas.

Pinnacle DuxtonThe current wait for applicants of a new BTO (build-to-order) flat is now 3 to 4 years, with some having to wait as long as 6 years. But the wait may soon be shortened to 2 – 3 years, according to National Development Minister Lawrence Wong. For now, applicants who need a flat sooner are opting to ballot for units under the Sale of Balance Flats (SBF) scheme, usually from a pool of units in developments which are nearing completion but have yet to be sold.

Foreigners may be surprised by the high prices for public housing in Singapore (in most countries, public housing areas are rundown and hardly in demand). And while Singaporeans can be proud of a solid and stable public housing sector, the fact that prices were skyrocketing over the past decade, and could potentially happen again if not kept in check, has the government on their toes.

tampinesgreenhdbThe recent discussion about the high resale value and potential value-appreciation of HDB flats in downtown areas such as at Pinnacle@Duxton has resulted in proposals to have different resale market rules for these units – such as a longer MOP (minimum occupation period), higher resale levies and shorter lease periods. As of now, 18 resale units of the 174 transactions at Pinnacle@Duxton have been sold at $1 million or more.  Keeping the public housing system fair will take some skilful tweaking as the population and economic landscape of the future is vastly different from that of 40 years ago.

Resale HDB flat prices fall in August

Photo credit: HDB

Photo credit: HDB

Rather than a market rebound, the HDB flat market may have to be content with stabilising prices and sales volume. August saw a 0.7 per cent dip in resale flat prices, led by a 1 per cent fall in 4-room flats, over the past 3 months after a slight rise in July. 3- and 5-room resale flat prices also inched down 0.6 per cent while executive condominium (EC) prices rose 0.8 per cent. The price drop is seen in both mature and non-mature HDB estates.

The Hungry Ghost month may also have had something to do with the drop in sales prices as buyers tend to hold off buying during that month though units with lower selling prices may have transacted hence pulling the average median prices down slightly. Since the market peak in April 2013, HDB resale flat prices have since fallen 11.5 per cent.

Photo credit: HDB

Photo credit: HDB

Property analysts predict a level market for the rest of the year, with price sustainability at best and as long as the economic forecast remains unclear and overall property market sentiment weak, any price rebound will be unlikely. Sales volume has however been rising, a promising sign, though as more new HDB flats reach completion within the next couple of years, more flat owners will be pushed to sell within a specified time period and competition may once again push prices down.

Sustainable and Community-focused projects win HDB Awards

Sustainability and community were the main drivers behind the winners of the Housing Board (HDB) Design and Construction Awards. 11 projects won for the HDB Design Award category and 12 Construction Awards were handed out to construction firms who had done well in the workmanship and structural works area.

Skyville@DawsonNotable winners included SkyVille@Dawson by WOHA Architects and Waterway Ridges by Surbana Jurong Consultants. SkyVille@Dawson features sky gardens for every 80 homes, that not only introduces greenery to the urban landscape, but also provides an area for community gatherings and exchanges. There is also a roof garden which links the 47th floor of each of the 3 blocks and even includes a 400m jogging track.

Waterway Ridges is a massive housing project near My Waterway@Punggol consisting of 7 blocks with a total of 832 units. The blocks are staggered in height and water is the main feature in the development. Harnessing the beauty of rainwater, 70 per cent of this natural resource will be channeled into the waterway by way of rain gardens, vegetated marsh areas and dry pathways.

Waterway RidgesA couple of this year’s winners upgrading projects from HDB’s Remaking Our Heartland scheme and the Neighbourhood Renewal Programme. The first are town centres in East Coast and the latter an upgrading project in Simei Street 1.

New HDB flats in non-mature estate prove popular

BuangkokWOods1Usually it’s the new HDB flats in matures estates which receive the most applications. But in Wednesday’s launch of 4,841 new Build-to-order (BTO) HDB flats, it were the units in Buangkok woods in Hougang which caught the most attention. In the same launch were units in the mature estate of Tampines and also in the non-mature estates of Sembawang and Yishun. The price difference between 3-room HDB flats in the 2 estates differ by about $20,000 with those in Tampines starting from $202,000 and $185,000 in Hougang.

The lower prices may have been the deciding factor for HDB flat seekers. Units in Yishun were starting from $156,000. As of Wednesday evening, the Hougang flats were already seeing 6 applicants for every 10 units while the 2 projects in Tampines had 2 to 3 applicants for every 10 units.

ValleySpringYishunHDBIncluded in the launch were 2-room flexi flats, which are much sought-after by singles who are now allowed to purchase new flats directly from HDB but only in non-mature estates. As per other HDB flats, they have 99-year leases or shorter ones for the elderly. These popular property-types were almost completely subscribed for within the first day of the launch.

For young families and couples looking for a flat in mature estates, the next launch might prove worthy of the wait, with 2,910 units in popular HDB towns of Bedok, Kallang/Whampoa and Bidadari. The last on the list will probably be of most interest to buyers.

Applications for the current launch will close on Tuesday, 23 August 2016.

Jurong Lake District – New sparkling Gem of the West

In less than 2 decades, the landscape of Singapore’s west-side could be said to be almost completely transformed. From the largely industrial factory districts to far-flung housing estates and only a few schools, new shopping malls, transport hubs, commercial and office spaces, private residential homes and spanking new build-to-order (BTO) flats now dot the scene.


Photo credit: URA

Jurong, once a busy but secondary commercial district, has been slated for development as Singapore’s second central business district (CBD). Every large city is almost certain to have one secondary commercial hub, as big and functional as the town-centre CBD, but newer and with more space for development. Just thing of Shanghia’s Pudong or London’s Canary Wharf. The Urban Redevelopment Authority (URA) is looking to transform the Jurong Lake District into a eco-friendly, futuristic township with homes, offices, hotels and filled with greenery and waterways.

LakeGrandeWith the Kuala Lumpur-Singapore high speed rail in its midst and as the convergence point of a number of new and existing MRT lines, there seems to be quite a far breadth for value appreciation of residential and commercial properties in the Jurong Lake district.

With Punggol and Jurong both set to include many good, new things may be coming the country’s way in the next decade or two.

Singapore home prices remain muted

As long as the property cooling measures are here to stay and global economics remain shaky, home prices may hover at the current levels.

ArdmoreIIIAnd as the government continues to roll out more new build-to-order (BTO) flats while keeping the loan ratio capped at 30 per cent, demand for resale HDB flats may continue its lacklustre run. Although there was a 0.1 per cent rise in HDB prices in Q2, prices were mainly flat and private home prices dipped further by 0.4 per cent, that is following a 0.7 per cent fall in Q1. Some property players have viewed the private property market as possibly reaching the bottom of the cycle.

Since the last market peak in 2013, HDB and private home prices are now 9.8 per cent and 9.4 per cent lower respectively. There have been some signs of recovery in Q2 as private property prices in the core central region (CCR) rose 0.2 per cent. Developers have also been actively seeking out sales by offering creative payment schemes and keeping sales volume to a respectable level.

Considering the average length of a property lull being 8.4 quarters, this cycle may already have reached the end of its run. Will a prolonged cycle mean an even sharper and more drastic rebound when the measures are loosened? How will the market then respond to that and will there be any drawbacks?

High demand for bigger units in mature estates

Senja HeightsAccording to response from applicants for the latest HDB sales launch of BTO (build-to-order) and SBF (sale of balance) flats, bigger units in mature estates seemed to be most hotly contested.

3,770 BTO flats were rolled out in last week’s launch, with units available in Ang Mo Kio, Bedok, Bukit Panjang and Sembawang. In addition, 5,170 SBF flats were also available for selection across 29 HDB estates. The units in Bedok and Ang Mo Kio were most in demand as these mature estates have well-developed infrastructure and some buyers who have lived there most of their lives prefer to move within the estate.


Photo credit: HDB

Will this mean a corresponding demand for resale flats of similar size in the same estates? It is debatable as prices of larger resale flats have already been falling as demand waned. As the availability of new units direct from HDB, and options of going into the private property market beckons, HDB upgraders will have quite a few pros and cons to weigh. While private homes within the same price range may be quite a lot smaller, rental and future value appreciation of selected private properties may entice buyers. On the other hand, upgrading within the resale HDB flat market may get you a larger unit though not necessarily with future sale benefits. Rental demand however could still be high should the unit be near a MRT station, school or other amenities.

HDB’s May launch includes units in mature estates

bedoknorthwoodsUp to 8,940 new BTO (Build-to-order) and SBF (Sale of balance) flats will be made available in HDB’s latest launch. Most action may be seen in Ang Mo Kio and Bedok, both mature estates with well-laid-out amenities. Analysts are expecting subscription rates of up to 5 times the number of units available. The other estates with new BTO units available are  Sembawang and Bukit Panjang while SBF units are available in most other estates, numbers varying.

Sembawang East Creek1Without doubt, flats in mature estates tend to have a more established resale value. But Minister for National Development, Mr. Lawrence Wong, is encouraging young families to consider flats in non-mature estates, stating that “a ‘non-mature’ estate today can become a ‘mature’ estate tomorrow” as the government is working hard to instate regional commercial hubs, transport and other public amenities into these newer towns in order to connect the residents to the workforce better.

He cites the difference of up to $100,000 between a 3-room flat in Sembawang and a similar unit in Bedok. In fact, 2-room flexi units could be priced as low at $4,000 with grants taken into account. 2-room flats are now available for senior citizens and also singles, though the latter are only allowed to apply for those in non-mature estates.


Photos credit: HDB

Applications for May’s launch will close next Monday on May 30.