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15 May

Married couples opt for HDB Parenthood Priority Scheme

It may or may not increase the likelihood of young Singaporean couples starting a family sooner, but more married couples are purchasing new HDB flats under the Parenthood Priority Scheme (PPS).

In the March sales launch alone, 32 per cent of Build-To-Order (BTO) flats were taken up by applicants under the PPS scheme. There is almost 100% possibility of all PPS applicants getting a flat. 3, 898 flats were launched in March in non-mature estates such as Sengkang, Punggol and Bukit Batok. A total of 12,000 applicants applied for BTO flats in the latest launch.

Compassvale Cape Mar2013

HDB’s next launch will be later this month, in Choa Chu Kang, Hougang, Jurong West, Sembawang and Woodlands. WIth 4, 850 new flats plus 3,000 balance flats from previous launches planned, response from PPS applicants may be even more than March’s 32 per cent. Other schemes which the HDB provides include the:

  • Multi-Generation Priority Scheme (MGPS)
  • Married Child Priority Scheme (MCPS)
  • Third-Child Priority (TCP) Scheme
  • Tenants Priority Scheme (TPS)
  • Ageing-in-Place Priority Scheme (APPS)
  • Studio Apartment Priority Scheme (SAPS)

It should be noted that for the hotly debated Executive Condominiums (EC), the priority schemes do not apply. And for previous Design Build and Sell developments, developers are required to give priority to buyers applying under the Married Child Priority (MCP) Scheme and the Third-Child Priority (TCP) Scheme.

Topiary Executive Condominium in Fernvale.

Topiary Executive Condominium in Fernvale.

Under the MCPS, applicants who are a first-time married couple and who have at least one child below the age of 16 qualify for up to 30% of BTO and 50% of SBF (sale of balance) flats in each launch. This scheme began in January 2013 and many have since successfully secured a HDB Flat by applying under this scheme. Whether this will help population growth and fertility rate remains to be seen, but at least it has helped Singaporean couples secure a home more quickly and without the pain of waiting endlessly.

Previously married couples had joined engaged couples applying under the Fiancee scheme. However unmarried couples made up close to 50% of the applicants under this scheme, which lessened the chances of those who are already married or already have a child securing a flat.

11 Mar

Singles will be allowed to buy new HDB Flats by July

This rang clear in the National Development Khaw Boon Wan’s message last Friday. And many are already cheering.

Currently singles above the age of 35 are allowed to buy HDB flats, but only from the resale market.

Currently singles above the age of 35 are allowed to buy HDB flats, but only from the resale market.

There are caveats however.

  • The age limit for singles buying flats has not changed, resale or new, you have to be 35 years of age before you can buy a public housing unit.
  • Singles can only buy 2-room flats . These flats are either 375 or 485 sq ft in size. This is just slightly smaller than some studio apartments or shoebox apartments in private condominiums.
  • There is an income cap at $5000.
2-room Bukit Batok HDB flat for sale.

2-room Bukit Batok HDB flat for sale.

A new 2-room HDB flat in Punggol went for around $100,000 last year, and that was before available grants kicked in. Currently singles can apply for a $15, 000 HDB grant if they earn $5000 or less. Mr Khaw has said that they recognise that those earning under $5000 a month will face difficulties owning a home in Singapore.

Part of the reason behind pushing out this new ruling by July this year is that the increased supply of new HDB flats have cleared “a backlog of applications from married couples seeking a Housing Board home for the first time”.

Is this new move a response to Prime MInister Lee Hsien Loong’s National Day Rally speech last year, where he acknowledged that singles have housing needs too?  Are these restrictions fair and what are the possible loopholes? Will this cause a drop of resale HDB flat prices and how will that change the landscape of this market?

19 Feb

Yishun climbing in ranks

As one of the sleepier HDB estates with perhaps an older, lower-income resident profile, Yishun could be seeing a turn of tide this year. Although as large, if not more, in size than neighbouring Ang Mo Kio and Woodlands, Yishun has been relatively quiet in terms of property investments and new property launches.

Miltonia Residences in Sembawang.

Miltonia Residences in Sembawang.

But a possible revival could be in its books. With recent launches such as Miltonia Residences and Skies Miltonia, and also a rise in industrial activity at A’Posh Bizhub, Northpoint Bizhub and North Spring Bizhub, there has been a rise in the number of residential transactions in the area. Over the past year, 1, 189 properties have been sold.

In January this year, 26 home sales were recorded, as compared to the 7 in January 2012. But with the lack of other new launches, home prices here could have lost some shine. So far, the average price of $874psf have pretty much stayed the same from a year ago. The only high which was recorded was in October last year when Skies Miltonia was launched.

NorthSpringBizhub

With one of the lowest percentage of young residents below 15 years of age, and 11 per cent earning below $1, 999 per month, perhaps an estate makeover could be in the pipeline. Keeping in mind that a new highway, the Eastern Dispersal Link, will shorten travelling time between the Causeway and the Iskandar development region in Malaysia, a new rush of temporary (and possibly permanent) residents might be headed Yishun’s way. Will this increase rental yields in that area?

According to Savills‘ head of research Alan Cheong, increasing the number and rate of new properties, both public and private, in Yishun may help to bring new, and younger, blood into the population. Will this be one of the next mature HDB estates to have new BTO flats?

14 Feb

Families benefit from new priority scheme

Before, it’s not often unheard of young couples having to wait years before getting the keys to their new flat. Some even have to wait to get a HDB flat, and then wait some more to live in their selected flat. But now, with a new priority scheme aimed at helping young families with children, the waiting time may be considerably shortened.

HDB's January BTO sales launch. Photo of Keat Hong Colours BTO Flats by HDB.

HDB’s January BTO sales launch. Photo of Keat Hong Colours BTO Flats by HDB.

And more are taking advantage of this, it seems. Up to the full 30 per cent of HDB flats allocated for them in January’s Biuld-to-Order (BTO) sales launch were taken up by applicants who qualify. This means, out of all the young families with children who applied for a flat, almost all will receive one. Named the Parenthood Priority Scheme, it was introduced early this year as part of the government’s push for marriage and parenthood. The scheme stipulates that up to 30 per cent of each HDB BTO launch will be set aside for married couples with children under the age of 16. It is aimed at helping couples set up families more quickly.

Success, however, is limited to the non-mature HDB estates such as Choa Chu Kang, Hougang and Yishun. Mature estates of Ang Mo Kio, Kallang/Whampoa and Tampines saw married applicants with kids applying for almost 80 per cent of the number of flats available. Understandably, mature estates are more popular with HDB flat applicants, regardless of category. These areas often already have established schools, amenities and means of transport, plus applicants may be applying for such areas in order to live nearer to their parents.

Flat allocation under HDB's Parenthood Priority Scheme. Photo by HDB.

Flat allocation under HDB’s Parenthood Priority Scheme. Photo by HDB.

Many applicants are hoping that this new scheme will increase their chances of successfully balloting for a flat, since quite a number have been waiting endlessly for one. For the rest of the applicants, it may be good news that HDB is planning to launch a ‘balance flats’ sale sometime later in the year and it may the lucky year of the snake for some.

31 Jan

3,300 new HDB Flats in January’s sales launch

Young married couples with children will get priority in the latest round of sales launch of new BTO HDB flats. These new flats are available in both mature and non-mature estates, namely Ang Mo Kio, Yishun, Tampines, Choa Chu Kang, Hougang and Kallang-Whampoa.

New BTO flats in both mature and non-mature estates in HDB's January 2013 launch.

New BTO flats in both mature and non-mature estates in HDB’s January 2013 launch.

New flats in mature HDB towns will cost more than those in non-mature estates. Yes, even fresh ones from HDB. But at $575,000 for a five-room flat in Ang Mo Kio, it is still considerably lesser than a similar one in the resale market which goes for as much as $628, 000. Units from the sales launch which are not taken up, will then be release to first-timers. First-timers can get up to $60,000 in grants. Prices start from $140, 000 for a 700 sq ft, three-room unit in Cho Chu Kang.

Photo from HDB.

Kebun Baru Court HDB flats in Ang Mo Kio. Photo from HDB.

Analysts are expecting an increase of bids from young families, but Dennis Wee Group spokesman Lee Sze Teck thinks otherwise. He thinks that most married couples who were looking for new living arrangements may have already done so by now, especially if they have children below 16 years. And if they haven’t, it could be that they are comfortable with their current situation thus may not be that eager to go for a new HDB flat. But still, response may be as heated as before, simply because the resale market is rising to unreachable heights.

The next launch of 3,980 BTO flats will be in March with units in Bukit Batok, Punggol and Sengkang.

30 Jan

Steep rise in Resale HDB Flat COV

The storm that brewed in the public housing market last quarter came in the form of COV prices. Rising from $45, 000 to as much as $67,800 in popular mature estates such as Toa Payoh and Tampines, January’s cooling measures may just have been the breakwater to calm the waves. The cooling measures have only just been implemented, and the first three weeks of 2013 saw steady median COVs and demand for resale HDB flats.

Mirage new HDB BTO Flats in Choa Chu Kang.

Mirage new HDB BTO Flats in Choa Chu Kang.

Whether these price waves will crash and subside or overtake the cooling measures, may be dependent on the supply of flats as well as whether there are changes in the eligibility of singles in applying for new HDB flats. Although National Development Minister Khaw Boon Wan has mentioned that this year may be the year rules change, it still awaits implementation.

The lack of supply of resale HDB flats is also partly due to the fact that most HDB owners see their flats as a good source of rental income, and as long as that option is open, and the rental demand is high, they may be unwilling to forego their HDB flats, thus decreasing the number of available resale flats in the market.

Some reasons which may have driven buyers to look for resale HDB flats:
1. They are willing to pay for a favourable location
2. They want to move into a new home quickly
3. They are looking to upgrade within the public housing category to a bigger space

On the other side of the coin, industry analysts have brought up the point that demand for resale HDB flats are driven largely by those who are ineligible to purchase new HDB flats, mainly permanent residents (PRs) and singles. Does this mean then that these groups of buyers are actually able to afford resale HDB flats and thus there may not be a need to change things around and allow them to purchase new HDB flats? Or will a change of rulings mean lesser HDB flat owners may now benefit from the rise in value of the properties over the years? Will this largely decrease the potential pool of buyers of resale HDB flats or will the demand continue to be present, perhaps minus COV (cash-over-valuation)?

24 Dec

Executive Condominiums expected to do well in 2013

As more EC sites are released, more new EC projects are launched, and more households qualify for one, activity in this sector is only set to increase in 2013.

Heron Bay Executive Condominium on Upper Serangoon Road.

Heron Bay Executive Condominium on Upper Serangoon Road.

opular executive condominiums include:

There does not yet seem to be an oversupply issue here, as compared to the mass market private property market or the luxury non-landed apartment sector. The market trend is indicating a widening of the price gap between a new executive condominium and a resale HDB flat; and a narrowing of that between a new executive condominium and a private condominium.

Recently there were some hype over bigger EC units which were selling beyond the $1 million mark. If this trend continues, and new EC units are priced higher and higher, might it cause a crunch in the resale HDB flat sector as some opt for the latter? Home buyers are now looking for properties that will go the mile in making their buck last. Areas such as Punggol and Serangoon where the ratio of private to public homes is lower than the national average, will continue to see active buying in the EC sector. Executive condominiums are a hybrid between private and public housing, where after the minimum occupation period of 5 years, they can be sold on the private property market; and after 10 years, they can be sold to foreigners.

Yishun HDB Flat

Reports show that there are currently 46, 000 households living in four and five-room HDB flats who, after the raised income ceiling of $10,000 to $12,000, will qualify for ECs. But does it necessarily mean that they will opt to upgrade to an EC? And even if they do, will they they want to put their resale HDB flat in the market for higher prices as they will now need more to pay for their new EC home? Is it merely a vicious cycle which will spiral upwards before a mighty fall? Or will the developers be the ultimate winners as more accept the higher home prices?

5 Dec

Once, twice, always a HDB Flat

First time round, they opted for a new HDB Flat. Second time round, it’s still their first choice. On the second-time HDB buyers’ checklist are bigger flats in Bedok and Toa Payoh.

Five-room flats in Bedok’s Fengshan GreenVille new BTO flats were oversubscibed by six times.

They may be flocking back to buy new HDB flats directly from the authorities rather than try their luck in the resale HDB flat market simply because luck, or prices, may not be on their side. Rising resale HDB flat prices, driven up by rising private property prices which saw more downgraders competing for the  same limited pool of resale flats,  have made those who are looking to upgrade within the public housing market think twice. It certainly does not help that Permanent Residents (PRs) and singles are also looking at the same resale HDB flats.

Mature HDB estates are the most popular with the second-time buyers and they are also preferring larger units. Units in Fengshan GreenVille in Bedok were oversubscribed six times for five-room HDB flats. Sengkang also saw some heat for Compassvale Mast, though no surprises there as this new block will be just next to the Sengkang MRT station. Are buyers hoping to reap some profits when it comes time to sell?

Is the demand and supply ratio weighing too heavily on the buyers’ end? Will the increase supply of new BTO flats really release many more flats in the resale market and if so when will that be?

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