Stronger buyer response to first projects under prime location rules than for other BTO flats
Stronger buyer response to first projects under prime location rules than for other BTO flats. Approximately four out of every five buyers invited to participate in the selection process for the first Build-to-Order (BTO) flats under the Prime Location Public Housing (PLH) model at Rochor have reserved their flats, exceeding the average 60 percent for most BTO projects.
Property experts told TODAY that the prime location and the height of the housing blocks, at 47 storeys, were factors in the increased demand for Rochor flats as the government prepares to unveil details of two more PLH projects, in Bukit Merah and Queenstown.
National Development Minister Desmond Lee stated on Monday (May 23) on Facebook that there has been a “good response” to the two PLH projects, River Peaks I & II, which were launched in November last year in the Rochor area.
Mr. Lee stated: “We are in the process of selecting the first PLH project at Rochor, River Peaks I and II. Approximately 80% of buyers who have been invited to participate in the selection process thus far have booked their flats, which is higher than the average of 60% for most BTO projects.”
Due to the overwhelming response, the Housing and Development Board (HDB) will launch two more PLH projects in the upcoming exercise.
In response to TODAY’s inquiries on Monday, HDB stated that the projects will be located in Bukit Merah and Queenstown, but provided no additional information.
In his post, Mr Lee stated that the board plans to launch 4,500 BTO units in those two townships, as well as Jurong West, Toa Payoh, and Yishun, in its May 2022 BTO exercise.
The PLH model was introduced last November “to ensure that all HDB flats, including those in prime and central locations, remain affordable and accessible over time,” he wrote.
The PLH project’s rules include a 10-year minimum occupation period (MOP) and the exclusion of single buyers. In addition, when the owners sell the flats, they must pay HDB 6% of the resale price or valuation, whichever is greater.
According to the HDB website, nearly 7,000 applicants competed for 680 units in the two PLH projects in Rochor.
Mr Nicholas Mak, head of research and consultancy at real estate agency ERA Singapore, explained that the appeal of PLH projects is due to their location and height when asked why the average number of buyers invited to the selection process is higher than for BTO projects.
He told TODAY on Monday: “To begin with, finding BTO projects so close to the city center, such as Rochor, is unusual. Second, the PLH clawback is 6%, which some believe is too low… However, when you sell after ten years, the price will have risen.”
He also mentioned that the projects’ height, at 47 storeys, is a major draw for buyers. This will be higher than the new project Lentor Modern with 25 storeys.
“The flats will be taller than the older resale flats in the area, and because they are younger than the other flats nearby, the price will be higher when they hit the resale market. Everything points to an eventual price increase “He stated.
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