Overwhelming demand for 2-room flexi BTO flats in Oct launch
Two-room flexi flats are seeing overwhelming demand from first-time single home buyers in the ongoing October HDB Build-To-Order (BTO) sales exercise, with as many as 20 applicants per flat in some projects.
Singles were behind the surge in BTO applications, said the Housing Board, which has received nearly 28,200 applications across all flat types as at 5pm on Oct 21. It is the highest number of applications since the November 2022 BTO exercise.
In a Facebook post on Oct 21, HDB said it expects to receive about 35,000 to 40,000 applications by the time the sales exercise closes at 11.59pm on Oct 23 – it would work out to about four or five applicants per flat.
The latest launch in October saw more than 8,500 flats put up for sale under a new framework, which classifies projects as Standard, Plus or Prime, based on factors like proximity to the city centre and transport connectivity.
BTO units closer to amenities such as MRT stations and town centres will fall under the Prime and Plus categories, which come with stricter resale conditions such as a 10-year minimum occupation period (MOP) and a subsidy clawback of between 6 per cent and 9 per cent.
October’s sales exercise also marked the first time that eligible singles can apply for two-room flexi flats in any location – these applicants were previously restricted to non-mature estates.
HDB said on Facebook that much of the surge in applications is being driven by pent-up demand from first-time singles, whose applications accounted for about 20 per cent of the total so far.
“This same strong singles demand was also seen back in 2013 when (first-time) singles were first allowed to buy a two-room flexi flat from HDB, where application rates hit a high of 58 times in the July 2013 BTO sales exercise,” it said.
It expects demand from singles to stabilise over time as the supply of two-room flexi flats increases.
HDB also attributed the higher application rate in October’s sales exercise to the high proportion of projects with good attributes and the 2,000 shorter-waiting-time flats on offer.
As at 10pm on Oct 21, more than 29 applicants were vying for each of the 130 two-room flexi flats in Bukit Batok, which have the shortest waiting time of around two years.
Flats in Ang Mo Kio and Pasir Ris were also popular with singles, with application rates close to the median rate of 22.2 across all projects.
For first-time families, the median application rate for three-room and larger flats stood at 2.1, slightly higher than the February and June 2024 launches, said HDB, adding that it expects the application rate to be lower than the pre-pandemic norm when the exercise closes.
HDB added that application rates for four-room flats across Standard, Plus and Prime were “fairly uniform”.
Application figures on HDB’s website showed four-room flats in Ang Mo Kio, Bedok and Kallang/Whampoa were among those that were oversubscribed, with between two and three applicants gunning for each unit.
Ms Christine Sun, chief researcher and strategist at OrangeTee Group, said there was a high application rate for singles across both Standard and Plus flats, with a median application rate of 22.2.
This was significantly higher than previous launches – the median was 6.3 in October 2023 and 4.5 in August 2023.
Mr Eugene Lim, key executive officer of ERA Realty Network, said singles buying BTO flats would have to be within the $7,000 income ceiling, and for these home buyers, a two-room flexi flat would likely be their only property purchase.
Since they would likely not be upgrading, location would be a top priority, he said.
“As such, they do not have any concerns about having to commit to a 10-year MOP for Prime or Plus flats,” said Mr Lim.
Ms Sun agreed, pointing to the high application rates in Plus projects in Ang Mo Kio and Kallang/Whampoa as evidence that “many young people do not mind the extended MOP and more stringent resale criteria, even if the flats are not located in prime locations”.
She added that community care apartments were undersubscribed, likely because many seniors selected two-room flexi flats instead.
Low application rates, indicating a good chance of being able to book a flat, continue to be observed in some projects, said HDB.
For instance, the application rates for first-time applicants applying for three-room and bigger flats in the Standard project in Taman Jurong Skyline, and three-room flats in the Plus and Prime projects of Kallang/Whampoa are below 1.
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