The recent ramp up construction of BTO flats might soon be a thing of the past as Singapore seems to reach the point where supply meets demand. This can be seen in the recent market measurements such as BTO application as well as COV which sees demand soften especially in the recent months.
According to statistic, the government has been building BTO flats at an accelerated pace in the past 3 years to meet demand. Demand for BTO flats have always been on the high side in the city state as public housing seems to be only the affordable option for the mass Singaporeans. As can be seen in the resale data, Cash over valuation (COV), one of the most important data for a general measure of demand of HDB flats, saw a downward trend since the start of the year. The median COV in October was $12,000, a far cry of $35,000 at the start of the year.
Less Demand for BTO Flats
Also, another measure to see the demand of HDB flats is the number of units of HDB sold below valuation. HDB has mentioned that 105 units were sold below valuation in October. This works up to be 7% of the resale volume. Comparatively, the percentage of units sold below valuation was only 0.3 percent in the first half of the year.
With that mentioned, the number applicants per BTO flat has also dropped drastically. According to the HDB, the application rate for BTO flats has dropped to 1.2 times compared to 25.9 times in Nov 2011.
Less COV for HDB resale flats
Lesser BTO flats will mean better market news for The Hillford Condo. This is because eventually property buyers might have to look at The Hillford condo if they are not able to get a HDB unit in Jalan Jurong Kechil area.