When it comes to new BTO launches, first-time homeowners can probably attest to the anticipation, stress and a whole lot of finger crossing that comes with balloting for a new flat. Depending on location, some areas such as Telok Blangah can see up to 23x oversubscription, meaning you have a 1/23 chance of getting the flat you want.
If you still prefer to get a newly-built flat as compared to an existing one from the resale market, but don’t really want to deal with all the anxiety – and possible heartbreak – of the BTO lottery, you can consider going for the Sale of Balance Flats (SBF) instead.
What is the Sale of Balance Flats (SBF) Exercise?
Image credit: Anatoliy Shostak
In a nutshell, the SBF exercise is where you apply for unsold flats from past BTO launches, remaining flats from the Selective En bloc Redevelopment Scheme (SERS) replacement sites, or flats repurchased by the HDB.
Annually, there are 4 BTO launches every 3 months, in February, May, August and November. Of the 4, 2 of them in May and November will have the additional option to purchase balance flats instead of the newly-launched BTOs. Take note though that during these exercises, applicants can only choose one or the other.
What are the types of flats that fall under SBF?
The types of balance HDB flats up for sale under SBF can vary widely, given that the pool of available units are gathered from various sources.
For past BTO launches or SERS replacement sites, these would typically be units from sites that were not as popular, either because of their site location or the unfavourable choice of flats remaining. Some of these being the flats facing and proximity to rubbish clearing points, low-lying flats, and those that don’t get a lot of breeze or sunlight.
SBF units also include flats that are repurchased by the HDB from people giving up their flat, for unfortunate reasons such as couples breaking up or realising they cannot afford the unit.
Another important point to remember is that unlike new BTOs launches where the HDB will publish information about it months in advance, details about the SBF will only be out on the launch day itself. The application window is also only one week, so you’ll need to be prepared to make a decision fairly quickly on what unit you want to go for.
Am I eligible for an SBF unit?
There is no separate criteria when applying for either BTO units or SBF units. If you’re buying a flat together with your fiancé/fiancée, one applicant has to be a Singaporean citizen, while the other has to be either a Singaporean citizen or a PR.
You must also be at least 21 years old, and meet the income ceiling for the type of flat (e.g. 3-room, 4-room) that you are intending to purchase. You must also not be the owner of any other property; if you are, you’ll have to relinquish ownership of it within 30 months from your BTO application.
What happens if I am unsuccessful in securing an SBF unit?
Assuming you were unsuccessful in getting a HDB unit in an SBF exercise, fret not! All unsold units after the exercise will subsequently be pooled together for open booking, via the HDB’s Open Booking portal. As of writing, all units available for open booking have been fully taken up, and the next offer of units will be in September 2022.
Most Recent SBF Exercise
As we’re already in the month of May, the next SBF exercise is just round the corner. While we won’t know details until the day itself, we know that on the BTO side, there will be about 5,200-5,700 BTO flats in towns/estates such as Bukit Merah, Jurong West, Queenstown, Tampines, Toa Payoh and Yishun.
In the meantime, the last SBF exercise in November 2021 saw 1,798 balance flats up for offer, comprising 553 2-room Flexi units, 300 3-room units, 667 4-room units, 243 5-room units, 31 3Gen units and 4 Executive units across various towns/estates.
Image adapted from: HDB
The average selling prices for the November 2021 SBF units were also pegged fairly competitively. For a generic 4-room HDB unit, the most expensive non-mature town was Tengah ($314,000), and the most expensive mature town was Queenstown ($574,000).
Pros and Cons of the SBF
One of the main benefits of getting an SBF unit is the shorter waiting time as compared to a BTO unit. Typically, each new BTO launch will take about 4-5 years to complete. However, the COVID pandemic in the last two years had caused significant construction delays due to border closure and supply-chain disruptions, resulting in completion delays of new BTOs.
As such, some couples prefer going for either SBF units or HDB resale units, especially if they don’t want to wait for such a long period to eventually move in.
Image credit: Galen Crout
SBF units usually take a shorter time to be completed, given that they are sourced from past launches and so construction would have already begun. For reference, about 31% of the SBF units in the November 2021 exercise were already completed, while the rest were in various stages of construction.
And so, going for an SBF unit would generally allow you to move in much earlier.
One other draw of the SBF exercise is that there’s a wider variety of units available, location-wise. For BTO launches, units up for offer are limited to a set number of estates/towns. However, SBF units have no such restriction, and so there’s greater flexibility given to prospective homeowners.
On the other hand, you can expect fewer SBF units to be up for sale as compared to BTO units, so there is a chance that you might face greater competition. Also, because these are remnant units which aren’t that popular, you might also find yourself hard-pressed to secure a really good unit. Though, that doesn’t mean you can’t find a diamond in the rough!
Applying for a SBF Unit
Since we’re already in the middle of May, you can expect news about the upcoming SBF exercise any time now.
If you’ve done the necessary homework and have decided to go for an SBF unit, be sure to look out for the announcement from the HDB! Once the exercise is open, you’ll be able to access HDB’s InfoWeb Portal and begin applying for an SBF unit. Do remember that you’ll only have a week to decide, so get ready to hustle.
Read our other home guides here:
- HDB En Bloc (SERS): Will your home stand a chance?
- How to get an Executive Condo in Singapore
- What happens to your BTO if you break up
Cover image adapted from: Anatoliy Shostak