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, which is higher than the average 60 percent for most BTO projects.
As the government prepares to unveil details of two more PLH projects, in Bukit Merah and Queenstown, 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.
National Development Minister Desmond Lee stated on Facebook on Monday (May 23) that the two PLH projects, River Peaks I and II, which were launched in November last year in the Rochor area, have received a “good response.”
According to Mr. Lee: “We are currently choosing 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 reserved their flats, which is higher than the national average of 60% for most BTO projects.”
The Housing and Development Board (HDB) will launch two more PLH projects in the upcoming exercise due to the overwhelming response.
In response to TODAY’s inquiries on Monday, HDB stated that the projects will be located in Bukit Merah and Queenstown, but provided no further details.
Mr Lee announced in his post that the board will launch 4,500 BTO units in those two townships, as well as Jurong West, Toa Payoh, and Yishun, in its May 2022 BTO exercise.
He wrote that the PLH model was implemented last November “to ensure that all HDB flats, including those in prime and central locations, remain affordable and accessible over time.”
The rules of the PLH project include a 10-year minimum occupation period (MOP) and the exclusion of single buyers. Furthermore, when the flats are sold, the owners must pay HDB 6% of the resale price or valuation, whichever is greater.
Nearly 7,000 applicants competed for 680 units in the two PLH projects in Rochor, according to the HDB website.
When asked why the average number of buyers invited to the selection process for PLH projects is higher than for BTO projects, Mr Nicholas Mak, head of research and consultancy at real estate agency ERA Singapore, said that the appeal of the PLH projects is due to their location and height.
On Monday, he told TODAY: “To begin with, it is unusual to find BTO projects so close to the city center, such as Rochor. Second, the PLH clawback is 6%, which some consider to be too low… However, when you sell after the MOP of ten years, the price will have increased.”
He also mentioned that the height of the project, at 47 storeys, is a major draw for buyers. This height is definitely taller than quite a number of private condominium such as the upcoming Lentor Modern. “The flats will be taller than the older resale flats in the area, and because they are younger, they will be more expensive when they hit the resale market. Everything points to a price increase in the future “He stated this.
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