This is question which often pops up to young couples planning for their first love nest.This is of course assuming that they do not exceed the income cap for the eligibility to apply for BTO.
In lay man terms, Build-To-Order flats are newly designed apartments mass released from HDB to meet the public housing demand. Buyers can choose from several locations available but the locations are mostly non-matured up and coming estates. Resale flats are typically flats which has fulfilled MOP(Minimum Occupation Period), older and most have less than 99-year left on the lease.
A BTO and resale flat each has their own set of benefits and appeal to the different types of eligible applicant.
Let us take a look at some of the pros and cons of BTOs and resale flats.
BTO Pros
1. Compared to resale flats, BTOs are certainly the cheaper option as they have been subsidized by HDB.
2. Design-wise, most BTOs echo newer designs which in cases take after condo designs
3. BTO flats tend to come with newer facilities in and around the building
4. BTO are brand new and you do not have to worry about background or the past of previous owners
5. BTO flats nowadays typically take a short time to complete
6. The flat is new and you begin with 99-year leasehold status
BTO Cons
1. Interior of BTOs may require renovations as only bare basics might be provided
2. BTO flats are typically much smaller than resale flats of the same type
3. BTO flats are generally built in non-mature towns making it difficult for couples to live near their families
4. Price is non-negotiable
Resale Pros
1. Resale flats are bigger - rooms, kitchen, bathrooms, living room are all far more spacious
2. Little to no renovation is required if the flat is in a good condition
3. Very little wait time as resale flats can be acquired as soon as both parties come to a mutual agreement
4. Resale flats are in mature estates making it easy for couples to live close to their parents
5. Resale flats in mature estates have established infrastructure and amenities
6. Prices are negotiable
7. Eligible for additional higher tier family grant on top of normal family grant if you live near your parents. (Same estate or within 2km radius)
Resale Cons
1. Generally you have to fork out more cash for Resale flats due to the Cash Over Valuation (COV) factor.
2. Resale flats have less lease left on shelf. Flats in matured estates can be left with as low as 50-60 years lease balance
3. More time may be spent searching for a suitable flat
4. Buyers may typically want to do more due diligence to avoid flats with problematic background such as loan shark harassed flats
4. Process can involve several third parties such as housing agents and lawyers who would be relatively more experienced when dealing with Resale and conveyancing procedures
No doubt both BTOs and Resale flats come with negatives and positives; it is always important that the couple sit down and weigh their options vs their needs at present moment.Buying a property can be one of the heaviest and most important investment that a couple makes. Therefore, it is always advisable to ask around and seek professional opinions based on the individual needs.
