October BTO exercise will test buyer demand for Plus flats, expert says

Plus flats will account for 38% or 3,273 units in the October launch.

Real estate expert PropNex views the October BTO exercise will be a "litmus test" for how buyers will react to Plus flats, which feature stricter conditions and longer minimum occupation periods (MOP) despite being outside prime locations.

In the October sales launch, 42% of flats will either be Plus or Prime.

According to Huttons, the differences between Plus and Prime flats lie in the clawback subsidy and resale restrictions. 

The clawback subsidy for Prime flats could increase to 10%-12% from the current 9%, while for Plus flats, it may start at 6%, the same as the first PLH flats.

"The income ceiling on buyers of resale Plus and Prime is not fair to singles. Singles whose income exceeds $7,000 per month can only buy either a standard or Plus resale flat. They are not able to buy a Prime resale flat," Huttons said.

Huttons, however, said applicants are unlikely to be discouraged by the restrictions on Plus and Prime flats. Based on past trends, many may prioritize buying first.

"Since the introduction of PLH flats in Nov 2021, the clawback subsidy of 6% has gone up to 9% in Jun 2024. This may go up further in the future if more subsidies are given to applicants," Huttons said.

PropNex reported that 38% (3,273 units) of the flats in October will be Plus flats. 

Projects featuring Plus flats include Bayshore Palms, Bayshore Vista, Central Trio @ AMK, Kallang View, Kembangan Wave, Merpati Alcove, and Towner Breeze.

Huttons estimates that 4-room flats at Bayshore Palms and Bayshore Vista may start from $530,000, which is more expensive than flats at Bedok South Bloom. 

For Central Trio @ AMK, prices may start from $550,000, similar to Central Weave @ AMK, despite Central Weave being closer to the train station but classified as a standard BTO.

For Kallang View and Towner Breeze, 4-room flats may be priced at $540,000, lower than the prices at Crawford Heights.