Is it wise to book a BTO HDB flat now?

[Ahyoo2002]

Punggol resale flats close the price gap

 

They now cost not much more than new flats in the area. -ST

 

Sun, Mar 08, 2009

The Straits Times

 

By Jessica Cheam

 

PRICES of resale HDB flats in Punggol have fallen in recent weeks to the point where they are now around the same level as new ones launched barely two months ago.

 

Normally new flats are markedly cheaper than resale ones as the Housing Board 'deeply discounts' their price to prevailing market values as a form of subsidy to first-time home buyers.

 

But the worsening recession, fragile job market and weak property sector have closed this 'discount gap' to virtually nothing in some cases, making resale homes as attractive as new ones.

 

This is a reversal of the trend during the pre-crisis property boom which saw first-timers flock to HDB for new flats when they found themselves priced out of the resale market.

 

Experts also point to weaker demand for premium, five-room flat types, which has led to a drop in prices.

 

The HDB's website this week showed that the range of resale prices for such five-roomers in Punggol had dipped, from $375,000 to $462,000 in December to about $350,000 to $440,000 last month.

 

Out of 36 five-room transactions in February, a majority of 29 were priced below $400,000.

 

This puts them in a similar price range as new five-roomers launched at Punggol Regalia in December at $342,000 to $428,000, and Punggol Arcadia in November at $356,000 to $416,000.

 

Even prices at the lower end for Punggol's premium four-roomers have fallen from around $338,000 in December to $306,000 last month.

 

First-timers eligible for housing grants that may reach as much as $70,000 could now be paying much less for a resale flat than a new one.

 

This could prompt some cost-conscious buyers in the queue for new flats in Punggol to drop out and buy resale ones, said ERA Asia-Pacific's associate director, Mr Eugene Lim.

 

Analysts say the dip in prices has come as home buyers are less likely to pay a premium, or cash-over-valuation, for a flat amid a deepening recession where every quarter sees fresh layoffs.

 

When HDB launched the Punggol flats late last year, the prices were also based on earlier, higher-priced transactions so it was 'inevitable' for new and resale flat prices to have some overlap.

 

A similar scenario was seen in the 1998 Asian financial crisis when new flat prices were 'outdated' quickly due to a downturn in the property market, said PropNex chief executive Mohamed Ismail.

 

One such area was Jurong, where some first-time buyers eventually discovered they paid more for a new flat than for some resale flats, he said.

 

It is difficult to compare that situation to Punggol now as the latest projects launched have a premium price due to their attractive location near Punggol MRT station and proximity to the town centre.

 

Punggol also has long-term potential due to plans to transform it into Singapore's first waterfront public housing estate, added Mr Ismail.

 

Chesterton Suntec International's head of research and consultancy, Mr Colin Tan, pointed out that, unlike private developers, the HDB does not have the luxury of flexibility to adjust prices according to the market immediately.

 

'Once they've launched, the price is fixed. So there'll always be a lag effect,' he said.

 

One outcome might be that if the projects do not sell out, the HDB will take back surplus flats and relaunch them at a more attractive price later, he said.

 

Engineer Tang Zhi Wei,who is in the queue to buy a flat at Punggol Regalia, said the prices of resale flats are starting to look very attractive.

 

'I'd be tempted to drop out and get a resale flat if time was important and I couldn't wait,' said Mr Tang, 26.

 

But while it seems he is no longer getting a 'deep discount' for a new flat, he will still buy one as it is 'new and the location is good'.

 

The HDB has stated previously that it follows the market and adjusts prices accordingly.

In the aftermath of the Asian financial crisis when the property market suffered a severe downturn, new flats in Sengkang, for example, cost up to 30 per cent lower in 2005 than when they were first offered for sale in 1997 to 1998.

[Help1]

very simple answer to the question

1) if can wait, then apply

2) if cannot wait, then buy resale HDB/private property

 

wait or not wait...my wife and i waited for almost 4 yrs for our BTO flat to be ready while staying with my parents...now stay in my new flat for the last almost 1 yr liao...

[Ahyoo2002]

  On 3/9/2009 at 6:46 AM, Help1 said:

very simple answer to the question

1) if can wait, then apply

2) if cannot wait, then buy resale HDB/private property

 

wait or not wait...my wife and i waited for almost 4 yrs for our BTO flat to be ready while staying with my parents...now stay in my new flat for the last almost 1 yr liao...

 

I am just wonder will the history repeat itself, meaning those who booked later buy it cheaper

[Help1]

well...is never cheaper for HDB flats when the organisation refuse to reveal the breakdown cost of the HDB flat and their leader shorty mah still in reign

[Ahyoo2002]

  On 3/9/2009 at 7:04 AM, Help1 said:

well...is never cheaper for HDB flats when the organisation refuse to reveal the breakdown cost of the HDB flat and their leader shorty mah still in reign

 

LTA is the most transparent of all in term of car costs while HDB is the opposite

[Lingling]

got the queue number to ballot for unit at Dew Springs Yishun..

but most likely.. not gonna choose a unit ba..

deciding to wait..

[Help1]

maybe LTA is the most transparent among all but it is also the most revenue generator, they have the right to implement every single ERP gantry on every road (side road, main road, dirt road etc), road that is built and maintained by them can be erected with ERP gantry....

[Ahyoo2002]

  On 3/9/2009 at 7:36 AM, Lingling said:

got the queue number to ballot for unit at Dew Springs Yishun..

but most likely.. not gonna choose a unit ba..

deciding to wait..

 

If you got a queue number, meaning you are allowed to choose a unit if there is left over.

 

Why decide to wait?

[Ahyoo2002]

  On 3/9/2009 at 7:41 AM, Help1 said:

maybe LTA is the most transparent among all but it is also the most revenue generator, they have the right to implement every single ERP gantry on every road (side road, main road, dirt road etc), road that is built and maintained by them can be erected with ERP gantry....

 

I starts to think HDB will be the most revenue generator soon judging by the price of the recent BTO launches

[Refugee]

  On 3/9/2009 at 7:36 AM, Lingling said:

got the queue number to ballot for unit at Dew Springs Yishun..

but most likely.. not gonna choose a unit ba..

deciding to wait..

 

got queue number dun select HDB will fault you.

 

after 2 times you'll lose your extra chances in the ballots.

[Ilix]

To me, no such things as gd timing or bad timing.

 

If you need to or have to, you gotta ballot. In any case, not confirm you can get also mah.

 

I'm allocated an unit in CCK under the BTO. Most prolly would be selecting the unit nxt mth.

 

During this 10yrs, just save up more and buy a private then rent it out lor.

[Schneider79]

  On 3/9/2009 at 7:09 AM, Ahyoo2002 said:

LTA is the most transparent of all in term of car costs while HDB is the opposite

 

LTA is most transparent as all cars are imported and the market is privatized. It will not so transparent if there is a make/model manufactured locally.

[Pcslim]

How low can you expect the price to go further? The price is not determined by the market as claimed. Its fixed by the one and only HDB.

[Ahyoo2002]

  On 3/9/2009 at 8:17 AM, Ilix said:

To me, no such things as gd timing or bad timing.

 

If you need to or have to, you gotta ballot. In any case, not confirm you can get also mah.

 

I'm allocated an unit in CCK under the BTO. Most prolly would be selecting the unit nxt mth.

 

During this 10yrs, just save up more and buy a private then rent it out lor.

 

How BTO work? Why you say allocated a unit?

 

[Ahyoo2002]

  On 3/9/2009 at 8:42 AM, Pcslim said:

How low can you expect the price to go further? The price is not determined by the market as claimed. Its fixed by the one and only HDB.

 

How low it can go i am not sure. I only know that value of some flat goes up as high as 30% in 2 years time.

[Blackyv]

  On 3/9/2009 at 8:42 AM, Pcslim said:

How low can you expect the price to go further? The price is not determined by the market as claimed. Its fixed by the one and only HDB.

 

 

somehow, it's true to certain extend that it could be determined by market force ... provided buyer still buying and not into waiting mode, hdb could still do their valuation at sky high number but if no buyer, they will sooner or later have to valuate at lower value to "push" for market movement...as they always put it, it's the market force which push the hdb pricing up (of cause hdb wont admit they have their dirty hand in it), and to help push the value down, market does play a part.. (stop buying and see how fast the price will drop... ... )

[Ahgongwolve]

  On 3/9/2009 at 6:46 AM, Help1 said:

very simple answer to the question

1) if can wait, then apply

2) if cannot wait, then buy resale HDB/private property

 

wait or not wait...my wife and i waited for almost 4 yrs for our BTO flat to be ready while staying with my parents...now stay in my new flat for the last almost 1 yr liao...

 

Buy la...

December 23 2012 is the end of the world

[Ilix]

  On 3/9/2009 at 9:17 AM, Ahyoo2002 said:

How BTO work? Why you say allocated a unit?

 

When there is a BTO exercise, hdb would give a period of time for people to apply for it.

 

After the closing date, hdb would then give a Q no. to you.

 

If, let's say, there are 150 5-room flats and your Q no. is 60, you would then know you are allocated one unit.