Sunday, December 20, 2009

Don’t shun flats in newer estates

A young couple pushed past me the other day at the HDB Hub in Toa Payoh, chattering excitedly and pointing at some documents in their hands.

Looking at their beaming faces, the mild annoyance I had felt at being shoved by them evaporated. Clearly, they were so engrossed in selecting their dream home that deliberately giving offence to anyone was the furthest thing on their minds.

Seeing their enthusiasm in the crowded Housing Board sales office was gratifying, as it reinforced my view that many Singaporeans – a solid but silent majority – go about their business of acquiring a home with little fuss.

If you read the newspapers regularly, you could have an entirely different impression.

Based on the volume of public griping in newspaper stories and letters to the editor over the availability and affordability of homes, it is easy to lose sight of the fact that the HDB has been satisfying – and will continue to satisfy – the housing demand of a large number of Singaporean households.

Much of the griping, I feel, is generated by a small but vocal minority, and their views carry a disproportionate weight in the great housing debate.

Minister for National Development Mah Bow Tan has said the HDB expects to offer 10,000 to 12,000 new flats a year for the next five years to accommodate rising demand for public housing. The bulk of these flats will be located in new estates such as Punggol and Sengkang.

This building programme should take care of the majority of home buyers.

But satisfying the demand of those who insist on a new flat in a mature estate near the city is harder. Last week’s launch of 1,718 flats in Dawson Estate will go some way towards meeting the aspirations of first-time buyers of new flats in a mature estate.

Although a significant number, the 1,718 flats will be gobbled up in no time. On the first day of the launch, flat applications exceeded supply.

Home buyers are a savvy lot. They know that new flats in mature estates are limited, particularly when these are a mere 10-minute drive from Orchard Road.

Dawson is located in Queenstown, where some of the most expensive HDB resale flats are found. Under the circumstances, it was a foregone conclusion that the Dawson flats would be heavily oversubscribed, and balloting would be required once again. This means the chances of securing a flat at Dawson are slim.

Still, I suppose there is no harm trying your luck. I would do the same if I were still eligible for a flat.

Just don’t raise your hopes too high, lest disappointment follows.

If you succeed in getting a flat at Dawson, congratulations, you have hit the jackpot. If you fail, don’t be disheartened. Go for other flats in newer estates where the success rates of first-time buyers being offered a flat are eight in 10, or, if they failed in their first attempt, 9.6 in 10 on their second try.

I understand why some buyers hold out for a new flat in a mature estate.

Having been a city dweller for most of my life, I too was leery at the thought of living in the suburbs.

When my wife and I were hunting for our first home in 1995, Singapore was in the throes of a housing boom, not unlike the property frenzy in 2007 and, more recently, between May and September this year.

Five-room HDB flats in popular estates near the city were changing hands at half a million dollars or more. By 1996, rooftop executive maisonettes in Bishan were going for $800,000.

There was no way we could afford those prices. Buying a flat directly from the HDB was our best bet.

Back then, new flats were sold either through a queue system (for flats in non-mature estates) or via balloting (for flats in popular estates).

After a wait of about two years, we had reached the head of the queue and consequently received an invitation from the HDB to book a flat in Woodlands. Around the same time, an opportunity came up for us to ballot for a flat in Holland Village, where we really wanted to be as it was also where my wife’s parents live.

There were a few hundred flats up for grabs, but the number of applicants was at least thrice that.

We were in a bind.

If we rejected HDB’s invitation for a flat in Woodlands and opted to ballot for a flat in Holland Village instead and were unsuccessful, we would be relegated to the back of the queue. This could lead to a wait of another two to three years before getting another bite.

On the other hand, accepting HDB’s offer meant that we had no chance at all of getting a home in a dream location.

After agonising over it for days, we chose certainty over desirability, but with much regret.

First-timers today are also facing a struggle.

If they are willing to settle for a new flat in Punggol or Sengkang, they are likely to get one fairly quickly. But that will mean blowing their chance of getting a new flat in a mature estate in future.

Theoretically, a second-time buyer is eligible to buy a new, bigger flat directly from the HDB. In reality, their chances are small as first-time buyers are allotted the lion’s share of new flats.

Taking everything into account, my advice to aspiring home owners is: Don’t be too choosy in terms of location. Get out of your comfort zone and go for a flat in a new estate.

Having lived in Woodlands for 12 years, I can vouch that living in the suburbs is not bad at all.

My family loved the surrounding parks, like Sembawang Park and Admiralty Park. Other rustic attractions like the Singapore Zoo, Sungei Buloh Wetland Reserve, Hay Dairies goat farm and numerous hydroponic farms in Lim Chu Kang are a mere 15-minute drive away.

Getting to the city is also not a hassle, as an MRT ride to Orchard Road takes just half an hour.

I moved to Toa Payoh two years ago to cut down on commuting. But I miss my old home in Woodlands as well as the friendly neighbours with whom our ties remain strong.

Leaving to live in centrally located Toa Payoh, I think, was perhaps a wrong choice.

Now that’s quite an admission from someone who dislikes living anywhere outside a 15-minute commute.

Source: Sunday Times, 20 Dec 2009

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