Benefits of Spacing Out BTO Launches and Reducing Number of Sale of Balance Flat Exercises

Mr Alex Yam Ziming asked the Minister for National Development (a) how will HDB's move to space out BTO launches and reduce the number of Sale of Balance Flats exercises benefit applicants; and (b) what comprehensive monitoring measures is the Ministry employing to assess the impact of this policy change on the entire housing landscape, especially the resale market, in the initial stages.

Over the last three years, the Housing and Development Board (HDB) has ramped up the Build-To-Order (BTO) flat supply and is on track to launch 100,000 flats from 2021 to 2025. We plan to launch about 19,600 BTO flats this year. This commitment remains unchanged, regardless of the number of launches in a year.

With the same number of BTO flats on offer, spread across three launches instead of four, homebuyers can look forward to a larger housing supply and a wider range of flat options at each BTO exercise. They may also face less competition and have a higher chance of success in securing a flat that meets their budget and needs. Moreover, spacing out the BTO launches will provide applicants with greater certainty, as it reduces the extent of overlap between flat selection exercises.

As the Sale of Balance Flats (SBF) exercise consists of unsold flats from previous BTO exercises, the total yearly supply is much lower than BTO flats. However, due to the shorter waiting time of SBF flats, demand for SBF flats tends to be very high. By holding one SBF exercise a year, HDB can consolidate supply and offer homebuyers more options at each sales exercise, with a higher chance of success.

To help home buyers, especially first-timers, move into their new homes and settle down quickly, HDB will launch about 2,800 BTO flats with shorter waiting time of less than three years, this year. HDB will also re-calibrate its building programme so that over time, such flats would form a larger proportion of BTO flat supply where possible. HDB will continue to closely monitor a range of different indicators, such as resale price levels and BTO flat application rates, to ensure that the public housing market remains stable and sustainable.