Flats in Geylang and Bidadari available in HDB’s latest BTO Launch

HDB’s latest sales launch of Build-to-order (BTO) and Sale of Balance (SBF) flats will include 1,273 units in Geylang and 1,355 Bidadari (Toa Payoh HDB estate).

BidadariHDBflatMAy17May’s launch may not be huge considering it will span 14 mature estates and 11 non-mature estates, but the inclusion of many flats in popular estates such as Ang Mo Kio, Bedok, Clementi and Kallang/Whampoa will draw the crowds for sure. 5 applicants per unit is expected for Geylang as the area has not had a launch for the past 3 years.

The government is however attempting to shift applicants’ focus to non-mature estates up North, namely in Woodlands and Yishun. Up to 2,000 new BTO flats will be launched in these 2 HDB towns with prices considerably lower than those in mature estates. For example, a 2-room flexi HDB flat in Geylang will cost $179,000 while the same in Woodlands will cost more than $100,000 lesser at $73,000. In Bidadari, a 2-room flexi unit will cost $169,000. A 3-Gen flat in Bidadari will be priced at $622,000 while the same in Woodlands costs slightly over half of that at $320,000.

DakotaHDBflatMAy17Bigger 4- and 5-room flats will also be made available in the current launch. But be prepared to pay $489,000 for a 4-bedroom unit in Geylang while a 5-bedroom flat in Yishun will set you back only $331,000. Plans to establish Woodlands as an area for regional businesses is on the way, though it will take some time before it becomes a full-fledged hub. Infrastructure that is being developed includes new MRT stations, a terminus connecting Woodlands to Johor Bahru and the North-South corridor. More HDB launches can be expected in the Woodlands estate in future.

In the meantime, the mature estates are expected to dominate the latest launch. Applications close on Wednesday, May 24. HDB’s next launch will be in August and it will include 3,850 new BTO flats in Bukit Batok and Sengkang.

*Photo credit: HDB

Resale HDB sales volume down last quarter

After a period of relative stability in the resale HDB flat market, numbers have dipped once more last month with 1,834 transactions recorded in April compared to 1,910 in March.

TheTerraceECPunggolSales volume for resale HDB flats fell 4 per cent in April, and was also 0.9 per cent lower than April 2016. Prices also fell 0.3 per cent from March with only that of 5-room flats increasing by 0.2 per cent. Resale prices for 3-, 4-room and executive flats fell 0.2, 0.7 and 0.9 per cent respectively.

While resale units in mature estates continue to be in demand, prices of those in mature estates have fallen 0.9 per cent, as compared to the 0.2 per cent of units in non-mature estates. Though this may not necessarily signify a bottoming-out of the property cycle, property analysts are hopeful that sales will pick up in the 3rd and 4th quarter to hit the 20,000 target by year-end.

Since the property peak of 2013, resale flat prices have fallen 11.4 per cent. Q1’s fall of 0.5 per cent was a little steeper than the relatively minute fluctuations of 0 to 0.1 per cent for the last year, but art of the fall in sales volume in Q1 could be due to the Chinese New Year festivities and the market continues to be plug on in a state of stability.

 

What do you do with an ageing HDB Flat?

If you live in a HDB flat with less than 60 years left on its lease, or are looking at one which you really fancy, what can you make of its limited lifespan?

HDB flat Jurong WestHDB flats have life spans of 99 years and in mature estates, many of these flats were built in the 1970s and 1980s, which means they are now about 30 to 40 years old at the minimum. Recently, the National Development Minister Lawrence Wong has raised concerns about the high prices paid for HDB flats with very few years left in the leases. The value of HDB flats decreases towards a zero mark on its expiry and will then eventually have to be returned to the Housing Board (HDB).

The issue of ageing HDB flats has also raised concerns for the elderly as they are unable to then monetise their HDB flats. The government has however offered up solutions to aid senior citizens in preparing for retirement. Three schemes are in place to do just that:

1) Silver Housing Bonus Scheme

2) Lease Buyback Scheme

3) Subletting the HDB flat

HDBFlatRentalThe first – the Silver Housing Bonus Scheme – allows the elderly to sell their flat, downsize and receive cash bonuses of up to $20,00. Should they chose to sell their flat, they can also receive up to $100,000 upfront in cash and $500 monthly retirement income.

The Lease Buyback Scheme allows owners of 4-room or smaller flats to sell the remaining years of lease back to the HDB for a cash bonus and regular retirement income. Though the cash amount is lesser than that of the Silver Housing Bonus Scheme, the scheme is more popular with 952 households taking up the scheme in within 10 months in 2016 and the flat owners can remain living in a familiar living environment.

The last option, while not offered directly by the government, is legal and permissible, giving the elderly an option of receiving passive income while still living in their own flat. As more flats age, it will become harder to sell older units, though some buyers are still willing to invest in an unit in a good location despite its shorter life span. It does ultimately boil down to the age-old rule of supply and demand.

Potential for new mixed-use development in Bidadari

Akin to Punggol’s development as a Eco-town, Bidadari, which is lauded as the next “Bishan”, could be shaping up to be a garden township especially as the first private home and retail site comes up for sale in the essentially HDB public housing township.

Bidadari HDB estatePhoto credit: HDB

A 2.54 hectare site next to Woodleigh MRT Station will potentially yield 825 homes and shops and is aimed to be the landmark of the new housing estate. Developers who successfully tender the bid for the land plot will be required to build not only the homes and retail spaces but also a community centre, neighbourhood police branch and carpark, much similar to the requirements of a commercial site listed the Government Land Sales (GLS) programme.

Paya Lebar Quarter_Lendlease PLQPhoto credit: Lendlease

Though the public and community-based requirements may cut into the developers’ margins, property analysts say that these could also be a value-add in terms of being a catchment area to for commercial tenancy and to goose productivity. The private real estate nature of the project is relatable to Lendlease’s Paya Lebar Quarter (PLQ), Central Boulevard‘s white site which was acquired by IOI properties for $2.57 million last year and older sites such as Raffles Hotel and the site which now holds Chijmes. The developer’s proposal will be reviewed by a panel chaired by the Housing Board (HDB). The tender closes on June 13 and industry players are expecting some bids as developmental sites are hard to come by in today’s market.

Last HUDC privatised last month – Braddell View

HUDC – most who grew up after the 80s will have no idea what these 4 letters mean in relation to the local housing market. In their heyday, the HUDC or Housing and Urban Devleopment Company scheme consisted of selected flats were built  larger, better and fancier than their other public housing counterparts. They were a little like the executive condominiums (ECs) of Design, Build and Sell (DBSS) flats of their day, meant to bridge the gap between the public and private property markets.

BraddellViewMost of the HUDC projects have been privatised over the years, and the era officially drew to a close as the last of the 18 HUDC estate reached privatisation last month. Braddell View, the largest of all the HUDC estates consisted of 918 flats and 2 shops and will join the other 7,731 units which have been privatised since its implementation almost 40 years ago. The scheme ended in 1987 when demand for bigger public housing options diminished due to the availability of private housing which fulfilled the wants and needs of the ‘sandwiched’ classes.

Ironically, many now think that the government could do very well to re-establish a scheme in the same vein as the HUDCs to provide for families hoping to upgrade within the public housing sector, especially as the newer flats are often lacking in terms of space. The privatisation of Braddell View has taken almost 18 years due to the staggered timing of leases of land on which the property stands. What is left for these HUDC estates after privatisation? The rather lucrative possibility of a collective sale, quite naturally.

 

February’s dip in resale flat prices points to market stabilisation

February was a little slow for the resale HDB flat market as prices fell by 0.3% and transactions by 8.5%. This was following a promising start to the year. But industry experts are not too quick to dismiss the possibilities for the sector as the year moves ahead.

ClementiHDBflatThe slight dip last month was most likely due to the post Chinese New year lull which is a common occurence. Rather than being indicative of a falling resale flat market, the decline simply points at a stabilizing  market enironment. Though resale flat buyers paid about $2,000 less than market value across  the board, some HDB estates continued to clock more than 10 transactions and at prices above market value

In Bedok, some buyers paid $10,000 and more for their resale flats while in Clementi, some transactions closed at $4,000 above market value. That comes as no surprise as these are mature HDB estates where demand is high. There were also some recent private property launches in the vicinity, for example the Clement Canopy, which may have had some residual effect on the resale HDB  flat market.

Aerial view of HDB flats in Ang Mo Kio

Aerial view of HDB flats in Ang Mo Kio

There were however a couple of HDB towns which did not post as promising figures despite being popular locations for flat seekers. In Queenstown, the lowest below-market prices were clocked at $12,500,  followed by $10,000 in Ang Mo Kio. Prices of 3-room flats rose by 0.2% while executive flat prices fell by 1.7%. Overall, prices of resale flats in mature estates rose by 1.1%.

 

Fresh Start Housing Scheme helps families start afresh

A new Housing board programme has been rolled out last December to help families own a HDB flat.

fresh-start-housing_long

Photo credit: Ministry of National Development

Aptly named the Fresh Start Housing Scheme, it is aimed at helping families who have once lived in subsidised housing and are now living in rental flats. They can now apply for 2-room flexi flats with shorter leases of 45 to 65 years, which means they pay less than the usual 99-year leasehold HDB flats secured directly from the housing board.

These will be a boost for lower-income families or those wanting to move on and up from the rental schemes. But as these rare 2-room flexi units are also made available to singles and senior citizens, they are one of the most popular unit types in the board’s latest BTO (build-to-order) sales launch. 713 such 2-room units were put up for ballot and the subscription rate was almost four times that with 2,894 applicants. First-time home buyers are also allowed to apply for grants of up to $35,000.

PunggolBTOFlat

Photo credit: HDB

There are however clauses in the Fresh Start Housing Scheme that limit qualifying applicants. Households applying under this scheme must have at least 1 citizen parent, 1 citizen child under the age of 16 and at least 1 family member must have had a stable employment for the last 12 months. The Ministry of Social and Family Development will also need to assess applicants and they must not have accumulated more than 3 months in arrears on their rental units.