Welcome to the second part of “Our BTO Journey” series where I intend to share my complete journey buying a BTO flat.
Buying a BTO flat is really a test of grit. You have to go through a series of obstacles that challenge your luck (will you get a queue number? will you get a good queue number?), perseverance (will you apply again if you’ve failed multiple times?), relationship strength (will you still be with your partner when the BTO is completed?), willingness to let go of control (your ability to get your favorite unit depends on the balloting algorithm, not your merit and definitely not your social/financial power), patience (there are A LOT of waiting in between stages), and too many other obstacles to be listed here.
But then again, good things never come easy. And anything worth having is worth waiting for.
To start the story about our BTO application, I need to go back in time to 2020.
Our first BTO attempt
We have been eyeing on BTO since early 2020. We planned to apply for BTO in May 2020 and we have decided on the exact project that we want (it’s a non-mature estate). Alas… May 2020 Launch never happened.
Because of Circuit Breaker, the May 2020 BTO Launch was postponed to August 2020. There goes 3 months of my life trying to get a BTO.
In August 2020, HDB launched 7000+ units which is twice the usual amount because of the backlog projects from May 2020. Excitedly, we applied for BTO for the first time, on the second day of sales launch (FYI, sales launch lasts for 7 days).
Exactly 3 and a half weeks later, we receive an email from HDB that says, “Unfortunately, as your balloted queue position has far exceeded the flat supply, we regret to inform you that your application is not successful.” There goes 4 months of my life trying to get a BTO.
“It’s okay, we will try again in November,” we told ourselves.
Our second BTO attempt
So, November 2020 sales launch came and our adrenaline started pumping again. We applied for a 5-room in a non-mature estate. Our hopes were high because we really like the location and the project.
While waiting for the ballot result, we even went to HDB Hub to take a look at the 3D model and made a shortlist of units that we want to select. We truly believed that this IS our time.
Exactly 3 and a half weeks later, we receive an email from HDB that says, “Your application has been balloted with a queue position of XXX. Although your queue position is beyond the XXX units of flats on offer, you may still have a chance to book a flat on your selection appointment. This is because some of the applicants queued ahead of you may not book a flat.“
So, we finally got a queue number! But, it is 38% more than the available units. We don’t even know if we’ll have a chance to get a flat. Even if we have, it’ll likely be units on the second or third floor.
Our third BTO attempt
By the time February 2021 BTO Launch rolls around, the project that we got a queue number for hasn’t even started the unit selection yet! So, we needed to make a decision whether to apply for Feb 2021 BTO or not.
We looked at the lineup and didn’t feel any excitement. We were unsure if it’s worth applying for a BTO that we were not excited with just to increase our chance of getting a BTO. We discussed it over and over for the next few days. On one hand, we’ve been trying to get BTO for almost a year now and it’s tiring us out mentally, and I felt that age is catching up with me and I can’t keep trying for something that’s not meant to be mine. On the other hand, we really want a new house.
We decided to go ahead to apply for one of the projects in this Feb 2021 launch. It’s not our favorite location. But it’s better that we apply now, rather than waste another 3 months and wait till May 2021 to apply for BTO again.
So, on the 6th day of the sales launch (or 2nd last day), we submitted our application. I’m sure you can sense how unenthusiastic we were.
Our third BTO attempt’s ballot result
I don’t know why, but good things do come when you least expect them.
Exactly 3 weeks and 2 days after we submitted our application, we receive an email from HDB that says, “Your application for a 5-room flat in XXX has been balloted with a queue position of XX. With this queue position, you will have ample choices of flats to choose from.“
Did you see what I see? Our queue number was 2-digit!! It was a small number, lesser than 50!! I couldn’t believe our luck! With our number, there’s even a chance that we can select the topmost floor!
We started researching more about this project and started shortlisting our favorite units. The more we research, the more we fall in love with this project. It was no longer the project that we feel indifferent towards. Now, it is the project with such a great neighbourhood, great view, direct access to park, away from concrete jungle. (Yeah, sometimes love does not come at first sight.)
The email also said that selection is going to start in April 2021. Meanwhile, for the Nov 20 project that we got the number for, 20% of the units have been selected, as of the first week of March 21.
Right now, we can’t make any decision yet whether to go with Nov 20 BTO or Feb 21 BTO. We don’t know if HDB will try to clear all of Nov 20 unit selection first before commencing unit selection for Feb 21, or HDB will commence Feb 21 selection regardless of the selection status of Nov 20 BTO.
Right now, we can’t do anything yet. All we can do is wait and see which project invites us to book first. All we can do is hone our patience. As of March 21, it’s been 10 months since we tried to get a BTO.
HDB website has a pretty detailed page about BTO application procedure, so I’m not going to repeat everything they wrote there. I’ll just provide a summary and tips for first-timers.
Brief summary of application procedure:
- Check your eligibility. Do you fulfil HDB BTO eligible conditions?
- Check your financial capability. Are you able to secure HDB loan/bank loan? Do you have recurring income that allow you to secure a loan? If your answer is yes for #1 and #2, proceed to #3.
- Research and shortlist the project that you want. Here, you can see the upcoming sales launch and the projects that will be offered.
- When sales launch comes, you’ll have 7 days to apply for the BTO project that you want. Sign in to HDB website using either your Singpass or your partner’s. Fill up the requested details, make payment of $10 and you’ll receive the confirmation email of your application. Congratulations!
Pro Tips for first-timer BTO applicants
1. Don’t rush
BTO result is based on balloting, not first-come, first-served. So, you don’t have to apply on the first day of sales launch unless you’ve solidified your choice.
2. Get familiar with applications received page
If you don’t care that much about the location and just want a sure-get flat, do monitor the applications received page to see which project is highly oversubscribed and which project is not too oversubscribed. Nowadays, it’s quire rare to see an undersubscribed project.
The link for this page will be available during sales launch, when you click Apply Now.
3. Determine the estate and room size that you want
When applying for BTO, you must choose the estate and room size. Both of these are final and can’t be changed in the future, so choose carefully.
4. Decide: HDB loan vs Bank loan
During application, you’ll be asked whether you want to take HDB Loan or Bank Loan. Do give some thoughts about the loan type you want to take before making BTO application.
If you choose HDB Loan, you’ll be paying only 10% down payment up front; meanwhile, for bank loan, you’ll need to fork out at least 25% down payment up front.
Personally, I feel that it’s better to get HDB Loan first and pay lesser amount for down payment. During the 5-year construction period, the 15% that would otherwise be locked in the bank can earn me at least 2k a year through dividend investing. That’s at least 10k extra money in 5 years!
In the future, after key collection, if the interest is really low, I can still switch to bank loan. If I choose bank loan first, I can’t switch back to HDB Loan, it’s a one-way street.
5. Don’t throw away your payslip
Never, never, ever throw away your payslip! Even if your paylips are digital, do take some time to download them and store them safety in your computer in case you change job and you can’t retrieve your payslip from previous company.
Why need to keep payslip? Because, in your BTO application, you need to declare your gross income for the previous 3 months. Also, you’ll need to submit them in the future during HLE application, during housing grant application, and during your first appointment with HDB when you’ll be selecting your BTO unit.
How many months of payslip do I need to keep? The more, the better! For housing grant, they even require 12 months of payslip, so if you don’t have the habit of keeping your payslip, you definitely need to cultivate it now.
6. Cancellation is expensive
Even though the application fee for BTO is so cheap at $10 per application, cancellation is not. Do think carefully if the project that you apply for is really what you want. And do think carefully whether the partner you apply BTO with is the right one.
If you get assigned a queue number, it’s counted as one successful attempt. If you change your mind and don’t want to attend the first appointment, you are considered as having rejected to select a flat once. If you reject twice, you’ll be banned from applying BTO for 1 year.
The complete BTO cancellation policy can be found here.
7. Don’t worry about HLE yet
It is not mandatory to have a valid HLE during BTO application. You can apply for it after you get notification for first appointment. As for me, I’m kinda kiasu, so I applied before ballot result was even out.
I’ll be sharing my complete BTO application process. Stay tuned!
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