Demand for Smaller HDB Flats Rise

The demand for smaller two and three bedroom HDB flats are rising, so said the Housing Development Board. It plans to build 4,000 units, with the first 2,000 units in 2009 and another 2,000 in 2010, to meet the increasing demand.

This demand is due to the needs of lower income families, homeowners who want to downgrade, and first time families who are starting on their own. Experts say that some homebuyers choose to own smaller homes due to the “difficult economic conditions”.

The HDB ceased constructing this style of smaller flats in the 80s when demand for bigger units was the norm. In 2004, construction of these units was re-started and they attracted more people than previously. In the first week of October, there were 2,426 eager buyers for 150 of these smaller flats. One buyer of a three-room flat said that he had a hard time acquiring his home because of the limited number of small flats that has been built.

The HDB is offering 504 four-room, 216 three-room, and 144 two-room flats at Dew Spring at Yishun Ring Road. This is under the built-to-order scheme where construction begins only when there is enough demand for the project.

These homes can be bought at $76,000 to $90,000 for two-rooms, $120,000 to $146,000 for three-rooms, and $197,000 to $238,000 for four-room flats. Demand is so high for small flats that a three room flat built in the 80’s sells for $175,000 – much more than what HDB is offering.

In 2008, the HDB built 6,600 units under the built-to-order scheme.