Why are there price differences among new flats within the same town?
In pricing flats for sale, HDB takes into account the prevailing market conditions at the time of sale, and various other factors. Looking only at the prices of BTO flats across different time periods would be an inaccurate comparison of affordability, especially for a first-time flat buyer. Comparisons that do not take into account such relevant factors could lead to inaccurate conclusions.
These are the different factors that impact the prices of new HDB flats:
- Flat’s Attributes
A larger flat would naturally cost more than a smaller flat. Other attributes like the purpose of the flat (e.g. 3Gen flats), the orientation of the flat (e.g. facing greenery, or a Multi-Storey Car Park), whether it is on a high or low floor, and waiting time for its completion, all play a part in determining its pricing. The prices of the flats on offer thus reflect their respective attributes. For example, it would be inaccurate to directly compare the price of a 5-room flat with that of a 3Gen flat in a certain project, when they have different sets of conditions and eligibility criteria.
Some areas are valued more than others, which accounts for the price difference between mature and non-mature estates. There are also other factors at play here; accessibility and amenities are two key ones. Hence, projects that are close to MRT or LRT stations and important amenities like, supermarkets, food centres or malls tend to be priced higher than those that are not. On the other hand, flats that are located close to expressways and major roads are priced lower.
- Housing Grants
Buyers of BTO flats are eligible for various housing grants, depending on their average gross monthly household income and this helps to reduce the prices of the flats.
Over the years, the Additional CPF Housing Grant (AHG) and Special CPF Housing Grant (SHG) have been revised and enhanced, to allow more people to benefit from it, and to make HDB flats more affordable for them. For example, applicants with an average gross monthly household income of $2,500 would qualify for a grant of $70,000 now, instead of $50,000 if they had applied for a flat before the enhancement of the SHG in Aug 2015.
The Government is committed to offering adequate affordable public housing to Singaporeans. To address the concerns of affordability, we have, in the past few years, increased grant amounts, adjusted the supply of flats according to our population’s needs, and raised the income ceiling so more Singaporeans can own a flat, Going forward, the Government will continue to monitor the public housing market closely to ensure that HDB flats remain affordable for Singaporeans.