PropNex, Singapore’s largest real estate company, wholeheartedly approves of two new HDB policy revisions concerning the bidding of Built-To-Order (BTO) flats.
One of the two revisions penalises bidders who reject flats that they are shortlisted for, while the other gives unsuccessful first-time bidders greater chances at their next bidding. Both these revisions aim to give genuine first-time buyers a greater chance of securing a BTO house.
“Both these revisions are timely measures from HDB,” says PropNex CEO Mohamed Ismail approvingly, “given the increasing number of applicants and an alarming rate of unsuccessful take-ups.”
Previously, all one needed to enter the queue for a BTO flat selection was $10. The resulting problem was a surplus of bidders who later rejected the selection process when they were shortlisted for a unit. For example, Coral Springs in 2007 drew 1,284 applicants for its over 500 units. Yet, to date, 211 units remain unsold.
The $10 application fee will remain unchanged under the new system. However, any first-time bidder who rejects two selections after being shortlisted will lose his or her first-timer status for one year. Their chances of getting a flat will then be greatly reduced, as only 10% of new flats are set aside for second-timers.
“This penalty will be a strong deterrent for people who do not take the purchase of new flats seriously,” says Ismail. “And in an rising property market, these people may end up getting their flat later at a greater price.”
The second revision was the introduction of additional chances for unsuccessful first-time bidders. All first-timers get two chances for bidding. From now on, two unsuccessful attempts earn them three chances at the next bid, three unsuccessful attempts earn them four bid chances and four or more unsuccessful attempts give them five bidding chances. Ismail believes that this implementation will greatly help first-timers with genuine housing needs.
Together with the government’s plan to continue providing BTO sites and thus maintaining supply, he also feels that there is no need for concern that there will be a shortage of available flats.
“However,” Ismail cautions, “the BTO flats generally require the younger generation to exercise diligence and consider fully their application before applying, as these flats are expected to be completed only three to four years from now.”
For those who urgently need public housing, he encourages them to look at the resale market and enjoy the government grants which could go as high as $70k.