Subsidy use, not age … decides who gets priority for HDB flats

GIVEN the pressing housing needs of an elderly population, the Government may want to consider giving the elderly priority when it comes to allocating new HDB flats, such as setting aside a proportion of such flats for them.

Such schemes, similar to those used in Hong Kong, could help meet the needs of Singapore’s changing demographics, suggested Member of Parliament Lim Wee Kiak (Sembawang GRC) in Parliament yesterday.

In response, Parliamentary Secretary for National Development Maliki Osman said that priority for new HDB flats is given to first-time buyers regardless of age, rather than buyers who have already benefited from public housing schemes, in order to be fair.

About 4 per cent of new flat applicants in HDB’s Built-to-Order (BTO) exercises last year were 55 years or older.

There are already specific housing schemes that are geared towards the elderly, stressed Dr Maliki.

He pointed to the popular studio apartments with elderly-friendly features specially for those aged over 55, which had a near-100 per cent take-up rate.

Further options for the elderly to unlock the value of their flats such as relaxing rules to allow the elderly to sublet their flats ,while simultaneously living with their children, and the Lease Buyback Scheme (LBS) are also available as an alternative options.

In the case of Dr Lim’s Hong Kong example, the flats in question are actually rental flats, Dr Maliki said.

“In terms of allocation of rental flats, we have put in place certain criteria with respect to the uniqueness of the housing policies that we have,” he added.

And while Dr Lim suggested allocating flats near the lifts for the elderly, Dr Maliki said that unit allocation would be complex.

In addition, he noted the fact that there have been no requests from elderly flat purchases for units right next to lifts.

He added that as a result of the lift-upgrading programme, most of the elderly now have access to lifts as they are on every floor.

Overall, the system will be able to weigh in favour of those who have not had their first flat, while still providing the elderly with varied housing options and schemes to meet their economic needs, Dr Maliki said.

Source: Today, 20 Aug 2009

Flats: Enough options, so no priority for aged

THE elderly here have sufficient options for their housing needs and there is no need to give them priority for new flat applications.

Parliamentary Secretary (National Development) Maliki Osman said this yesterday when he revealed that just 4 per cent of applicants for new HDB flats this past year were aged above 55.

He was responding to Dr Lim Wee Kiak (Sembawang GRC), who asked about new measures to deal with the housing demands of an ageing population.

The chances of getting a new flat are currently not based on age but on whether the applicant is a first-timer, Dr Maliki said, and explained that 90 per cent of new flats are set aside for those households setting up homes for the first time.

But he pointed to the various schemes already in place to cater to the housing needs of the elderly.

One option: Studio apartments, which have proven popular with a take-up rate close to 100 per cent. The HDB will be launching another 1,000 such apartments over the next two years. These flats, meant for those above 55, are on a shorter lease of 30 years.

Older Singaporeans can also opt to monetise the value of their flats to support their retirement through the Lease Buyback scheme introduced in March.

Under the scheme, the HDB will buy back the tail-end of a flat’s lease at market rate, leaving a 30-year lease for the household. It pays market valuation for the lease and this money goes to the new CPF Life annuity scheme in the flat owner’s name. A $10,000 subsidy is also given out – half paid in cash, while the other half goes into CPF Life.

So far, more than 300 have applied for the lease buyback scheme.

Other options open to the aged include downgrading to a smaller flat, renting out their apartment or a room, or selling their flat and living with their children.

Source: Straits Times, 20 Aug 2009

Cash upfront for HDB resale flats doubles in a month

Private property exuberance spills into public housing, with units selling $10k over valuation

THE amount of cash needed upfront to buy an HDB flat resale roughly doubled last month as the exuberant sentiment in the private homes market spilled over into public housing.

Three property agencies told The Straits Times that the median cash-over-valuation, or COV, has shot up across all flat types and has gone above $10,000 for some units.

In two of the more startling examples, a five-room flat at Depot Road sold for $70,000 above its $490,000 valuation, while an executive flat in Pasir Ris sold for $35,000 above its COV of $550,000, according to figures from PropNex and the HSR Property Group.

COV is cash that buyers pay to a seller over and above a flat’s market valuation. It cannot be covered by a mortgage or CPF money, and so serves as an indicator of flat affordability.

What is surprising is the speed at which it doubled in a month, said Mr Colin Tan, Chesterton Suntec International’s research and consultancy director.

Figures from the Housing Board (HDB) for the April to June quarter showed that median COV was zero for five-room and executive flats.

But data from PropNex, ERA Asia Pacific and C&H Realty for last month showed that this now ranged from $5,000 to $13,000.

The three agencies have a share of about 70 per cent of the HDB resale market between them.

There was a similar surge for three- and four-room flat types: HDB data put median COV at $5,000 in the second quarter, but the agencies said it rose to the region of $10,000 to $15,000 last month.

Based on ERA’s sales, the median COV for three-room units rose from $6,000 in the second quarter to $14,000 last month. The median COV is a mid-point: Half the units were sold for a COV above that value, and half below.

Industry observers say that the COV rise was inevitable given that the optimism in the private market was bound to spread to HDB flats.

HDB flat prices have staged a surprising comeback amid the recession, reversing a first-quarter dip of 0.8 per cent to rise 1.4 per cent in the second quarter and reach a historical high.

Analysts now predict further price increases for resale flats for the third quarter on the back of climbing COVs – as long as buying momentum is sustained.

PropNex chief executive Mohamed Ismail said high demand for resale flats is supporting surging COVs, as supply remains tight.

A cascading effect in the market is driving buyers to more affordable sectors.

Chesterton’s Mr Tan said some buyers who are being priced out of the rebounding private market are turning to HDB resale flats.

Private home prices have started to climb, buoyed by high buying activity that saw a stunning 2,767 units sold last month.

This, in turn, has resulted in first-time HDB buyers, hit by soaring COVs, being forced out of the resale market and into new HDB flats, said ERA associate director Eugene Lim.

This is already evident: The HDB was flooded by 5,392 applications for 769 flats at the recent launch of Punggol Residences. Applications closed last week.

That is a subscription rate of seven times in a market where a typical rate is three or four times.

New HDB projects, which take three years to build, have not seen such numbers since the 2007 property boom.

However, C&H Realty managing director Albert Lu observed that most of the sales are still done at reasonable COV levels of around $10,000.

‘There are some unrealistic sellers asking for high COVs as in the last boom, but buyers can choose not to bite,’ he said.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak noted that mass market private properties have a strong link to HDB resale flats, and COVs will stop rising only when mass market buying interest dies out.

Banking executive Goh Hui Min, 25, is one HDB buyer who is glad she bought her five-room flat in Telok Blangah for $590,000 about a month ago before the latest COV rises.

‘I paid $35,000 below the flat’s valuation, which, given the current market, is quite a fabulous deal,’ she said.

Source: Straits Times, 20 Aug 2009

Shared housing a short-term help for needy families

We refer to the letters, ‘Shared housing scheme may put children’s safety at risk’ and ‘Good plan but iron out conflict, privacy issues’ (Aug2).

The Interim Rental Housing, or IRH, scheme was introduced to provide temporary rental housing at low cost to households in financial difficulty while these households sort out ways to reduce their financial burden, for example, by downgrading to a more affordable flat.

Under the IRH scheme, two families share a flat to keep the rent low. This also allows the Housing Board to help more families in need.

While there are inconveniences to flat-sharing, we wish to highlight that the IRH arrangement is meant to be temporary.

A conscious effort is made to pair families with similar backgrounds. At the start of their temporary stay, basic house rules are established to help the families avoid conflicts.

The HDB’s managing agent is also stationed on site to offer help and mediate if necessary.

This arrangement has in general worked well for the 110 units leased out under the IRH scheme.

Besides the IRH, families in need may also consider other options, for example, staying with their friends or relatives.

We will continue to monitor the situation and review the scheme if necessary. We thank the writers for their feedback.

Mike Chan
Deputy Director (Rental Housing)
for Director (Housing Administration)
Housing & Development Board

Source: Sunday Times, 16 Aug 2009

HDB to launch another BTO project in Punggol

DEMAND for new public housing in Punggol has been high for a couple of years now. But with oversubscription rocketing for the latest build-to-order (BTO) project in the estate, the Housing and Development Board is launching another development in the space of a month.

This was announced yesterday as the application period for the 769-unit Punggol Residences, launched two weeks ago, closed with more than 5,100 applications.

The subscription rate of 6.7 is more than twice the ratio of applications to flats for recent BTO launches, such as that for Punggol Sapphire and Punggol Arcadia last year, which had about three times as many subscribers as available flats.

“The strong interest shows that homebuyers recognise that HDB’s latest project offers good value for money,” HDB said in a statement.

A four-room flat at Punggol Residences costs between $264,000 and $322,000, while a five-room flat is priced between $344,000 and $409,000.

HDB noted that “the consistently high subscription rates for BTO projects in Punggol Town is testament that the town has become a much sought after place to live in” – and the reason for its plans for another launch.

The continued launch of these BTO projects will “further contribute toward realising the vision of Punggol as a waterfront town”, it added.

So far this year, HDB has launched 2,800 flats under the BTO system. It reiterated yesterday it will increase this to 8,000 units or more, given the strong demand.

Source: Today, 13 Aug 2009

Strong demand for HDB’s build-to-order Punggol flats

APPLICATIONS for the build-to-order (BTO) Punggol Residences flats have been flooding into the Housing Board (HDB).

As at 5pm yesterday, the HDB had received 5,215 applications for the 769 flats on offer at the Punggol site.

This works out to a subscription rate of 6.7 times for the development, which comprises 615 four-room and 154 five-room flats. There were 3,609 applications for the four-room flats and 1,606 applications for the five-room units.

The deadline for applications is midnight on Aug 12.

An HDB spokesman said: ‘The strong interest shows that home-buyers recognise that HDB’s latest project offers good value for money.’

Punggol Residences, situated at the junction of Punggol Walk and Punggol Field, is located within the precincts of the future Punggol Town Centre.

It is a five-minute walk from the Punggol MRT station and the bus interchange, while the Tampines Expressway is a short drive away.

The prices range from $264,000 to $322,000 for the four-room units and $344,000 to $409,000 for the five-room flats.

The prices are comparable to those at Punggol Regalia, a similar premium BTO project next to Punggol Residences, which was launched in December last year.

To date, the HDB has launched about 2,800 flats under the BTO system and, given the strong level of demand, is committed to stepping up its supply to 8,000 or more units. It is set to unveil another BTO project for Punggol later this month.

‘The consistently high subscription rates for the BTO projects in Punggol Town are testament that the town has become a much sought-after place to live in,’ the HDB spokesman said.

The HDB believes the launch of new BTO projects in Punggol will further contribute towards realising the ‘Punggol 21-Plus’ vision of a waterfront town for the 21st century.

Source: Straits Times, 13 Aug 2009

Bukit Panjang: From ‘no frills’ to amenities galore

ALL residents of HDB flats in Bukit Panjang constituency will have lifts that stop on every floor by November.

It caps a $100-million effort that has transformed the ‘no frills’ new town into a place with a string of amenities over 12 years, said Dr Teo Ho Pin, MP of the single-seat constituency. He cited a long list that includes markets, places of worship, gardens as well as ramps and railings for the elderly and handicapped to move about freely.

‘I’d say the town is almost mature with all the facilities,’ he said yesterday, ahead of a ministerial visit to the ward on Aug 30 by Transport Minister Raymond Lim, who is also Second Minister for Foreign Affairs.

The one still-to-come significant change that will spur new development is an MRT station, said Dr Teo, noting that the Bukit Panjang station is scheduled to be open in 2015.

It will give residents a direct link to the Central Business District.

But lift upgrading tops the ward’s infrastructure development list, with more than $80 million going towards such works for 132 HDB blocks.

The Government pays between 75 and 90 per cent of the bill and the remaining 10 to 25 per cent is split between residents and the Holland-Bukit Panjang Town Council.

Besides the changes, Dr Teo also introduced ‘green’ initiatives to promote a pleasant living environment and save energy costs.

Among them are two community gardens, where residents grow vegetables such as sweet potatoes or chye sim for their own consumption.

In addition, solar energy lighting panels were installed on the top deck of a multi-storey carpark.

Dr Teo also started a briskwalking club for residents to exercise and bond with each other.A challenge now, he said, is to maintain the facilities and manage the impact of inflation on costs. However, the town council finances are healthy, he added.

The change that is most important to residents like Madam Mariam Maidun, 50, is the lift upgrading. The housewife, who has lived in Bangkit Road for 10 years, appreciates it especially when returning home after marketing with her bags of groceries. ‘It’s much more convenient now.’

But she misses the stools that were removed from the ground floor of her block during the upgrading works. ‘Most old people or housewives coming back from the market have no place to rest,’ she said.

Source: Straits Times, 12 Aug 2009

HDB spaces: No subletting rule observed in the breach

THE Housing Board’s reply, ‘HDB shop corridor area cannot be sublet’ (July 21), stated that HDB corridor areas should not be sublet by shop owners to third parties.

This may be the rule, but in my experience, it is often breached.

We operate shops dealing in mobile phones in Clementi and Bedok Central. A 100 sq ft ‘hole in the wall’ in these locations costs up to $7,000 a month to rent.

However, there are many fly-by-night mobile phone operators who set up shop in the yellow boxes in these areas and pay about $2,000 a month to rent the space. In Bedok Central, town council officers periodically patrol the neighbourhood to check on illegal peddlers. However, enforcement of the rule has been inconsistent.

A retailer selling accessories in a block there now rents out a small space inside the shop to a mobile phone retailer who then uses ‘her’ yellow box to sell mobile phones.

When we did the same thing a few months ago by renting a space within a provision shop in the same block and used the outside yellow box, we were told by the town council to vacate the outside area or face stern penalties. We understand that the landlords for both shops pay the same monthly fee to the town council for use of the yellow boxes.

To complicate matters, another retailer selling watches and optical wear in the same block also sells mobile phones in the yellow box space in front of his shop.

As this retailer owns and manages three different types of businesses, is he then allowed to use his yellow box to sell mobile phones?

What if that retailer selling accessories in her store claims that the mobile phone business belongs to her?

At Clementi Central, the situation is blatant. Over the years, legitimate mobile phone retailers have been vacating the area because of intense competition from illegal peddlers who sell the same products but pay a fraction of the rental.

The town council has not acted against such rental abuses. Now, there are at least eight illegal mobile phone retailers operating out of yellow boxes in Clementi Central.

Such inconsistent application of the rules runs contrary to efforts by the merchants associations to rejuvenate HDB areas and attract shoppers. We urge the HDB and respective town councils to be more diligent and consistent in checks of these illegal peddlers.

Hong Ghim Phong

Source: Straits Times, 5 Aug 2009

HDB demand gathers steam on a dream

Day One of latest BTO sees strong demand; new flat supply totals 6,500

WHEN the original Punggol 21 vision was unveiled 13 years ago, enthusiasts who bought homes in the sleepy estate became disillusioned when the model waterfront living failed to materialised and facilities were slow to appear.

But then the dream was revived with a bang two years ago – and since then, interest has been strong, with recent HDB Build-To-Order (BTO) projects seeing robust demand.

Yesterday was a case in point: The HDB launched 769 new Premium units under its BTO system, and by 5pm there were already 408 applications for the 615 four-room flats, and 185 applications for 154 five-room flats.

At previous BTO launches, such as Punggol Regalia in January and Punggol Arcadia last November, units were roughly three times oversubscribed.

ERA Singapore says Punggol features among its top five choice locations for resale five-room flats.

“The main draw is that the flats are affordable and (fairly) new,” said its Asia-Pacific associate director, Eugene Lim.

He noted that five-room flats in the estate were “struggling” with a selling price of $300,000 before Prime Minister Lee Hsien Loong’s announcement of the Punggol 21+ plan in 2007.

Now, those flats “easily” sell for $400,000 each, said Mr Lim. But even so, they are easier on the pocket than flats in mature estates.

According to data from Dennis Wee Group, a five-room resale flat at Toa Payoh Lorong 1 is valued at $520,000 – while a five-room resale flat at Punggol is valued at $390,000 to $410,000.

Much of the demand for Punggol resale flats is from permanent residents (PR), making up 40 per cent of PropNex’s sales in the estate, said chief executive Mohamed Ismail. “PRs don’t mind its (far-flung) location and they realise the benefits of a new estate,” he told Today. “They also don’t have any emotional attachment to mature estates, unlike Singaporeans.”

Not far from resale prices

But with the Government pushing out new flats in Punggol, would this put a downward pressure on resale flat prices in the area?

The supply at Punggol Residences launched yesterday brings total new flat supply in the estate to 6,500 since the unveiling of estate revitalisation plans in Aug 2007.

Property agents do not seem to think so, as BTO projects are targeted at first-time flat-buyers who can wait a few years for completion. Many who buy resale flats are looking to move in within three to four months.

Mr Mohamed Ismail further notes, the prices at Punggol Residences are just “marginally” lower than those of resale flats in the estate. He cited recent valuation figures of four-room resale premium units going for some $320,000, and five-room resale premium units going for up to $420,000.

Punggol Residences flats are priced at $264,000 to $322,000 for four-room and $344,000 to $409,000 for five-room units.

If market anticipation of the Punggol 21+ concept is anything to go by, prices are expected to remain steady, the analysts told Today.

“Punggol is basically a blank sheet of paper, it doesn’t have the clutter of mature estates so there’s a lot of scope for planners and Government to do many things as they bring about the waterways and so on,” said ERA’s Mr Lim. “I am sure it will be a very happening place in the future.”

Punggol resident Faith Toh is holding out hope for that vision. She and her husband bought into the original Punggol 21 idea when they shelled out for their executive flat seven years ago.

Launched in 1996 by then Prime Minister Goh Chok Tong, Punggol was to have been a model waterfront town with modern amenities such as watersport centres, clubs and libraries. But the 1997 Asian Financial Crisis and construction industry problems in 2003 put a crimp on plans.

“We thought when it becomes like East Coast or Tampines, it’ll be like living in town without having to go downtown,” said Ms Toh. Even now, she said, going home to Punggol’s “pretty” landscaping “feels like you’re staying in a resort”.

Source: Today, 31 July 2009

HDB launches 769 new flats in Punggol

THE Housing Board has launched a premium project offering 769 new flats in Punggol in a bid to build up critical mass in the estate.

The new project, called Punggol Residences, offers 615 four-roomers and 154 five-room flats in a central location just five minutes from Punggol MRT station.

HDB is launching the project under its build-to-order (BTO) scheme – flats are built only when certain demand is reached.

It has so far offered about 6,500 new flats in Punggol since it unveiled grand plans for the former fishing village to become the only waterfront public housing project in August 2007.

This is in line with the board’s commitment to build up the population in the estate to attract and support new facilities, it said.

Punggol Residences is a premium development with enhanced architectural designs, interior fittings and landscaping, said HDB.

Four-room flats of 91 to 96 sq m are going for $264,000 to $322,000, while five-roomers of 114 sq m are on sale from $344,000 to $409,000.

According to HDB, premium resale flats in the vicinity are selling for a pricier $330,000 to $350,000 for four-roomers and $380,000 to $439,888 for five-roomers.

PropNex chief executive Mohamed Ismail said that, despite the higher prices, resale flats might still be more attractive given that buyers can enjoy a CPF housing grant of up to $80,000 depending on their income, and do not have to wait three years for new flats to be built.

On the other hand, buying new flats direct from HDB will attract those who prefer not to fork out any cash for resale flats.

This amount, known as cash-over-valuation, has started creeping up for premium resale flats in Punggol to about $15,000 to $20,000, noted Mr Ismail.

As of 5pm yesterday – the latest update from HDB – 593 applications for the 769 flats have been received.

Applications for the new flats can be submitted online at HDB’s website www.hdb.gov.sg until Aug 12.

Source: Straits Time 31 July 2009