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This is a good step towards improving accessibility to a BTO flat which is a public good. If there are 20,000 flats launched for sale in a year, as high as 60,000 queue tickets are allocated to applicants. About 40% or 24,000 do not book a flat when invited to do so. This is a very high number. With this change, it should reduce the number of non-selection and thus allow more applicants to book a flat.
Applicants do not select a flat for various reasons. It could be due to non-availability of choice units, limited units left or sudden change in employment status. Since they intend to stay there for many years, they would want to choose the best unit in their view. To those with a genuine reason, they will feel aggrieved at this change.
This change will reduce but not remove the non-selection of flats among applicants. Huttons estimate that the number of applicants for Aug 2023 BTO may fall by as much as 20%. It may create a rush to apply for flats in Feb and May 2023 before the new rule kicks in.
If applicants are relegated to only 5%, they should turn their attention to either a resale flat or new EC. The Government has increased grants for first time buyers of a resale flat so it will make a resale flat more affordable. Eligible buyers of a new EC do get grants as well. Some demand may shift to the resale market and new EC market.
The introduction of a new category FT(PMC) will likely cover all broad categories of first time buyers and give them a better chance of booking a flat.
