POTENTIAL FINANCIAL GAINS
On the other hand, the benefit of buying a BTO flat in new estates like Tengah is that homeowners may see capital appreciation in the years to come. Buyers would be willing to pay more for the improved accessibility and amenities.
First-time buyers who bought a BTO flat in non-mature estates like Punggol and Sengkang have profited significantly from selling their house in the resale market after both towns became more built up.
When BTO flats in Punggol and Sengkang were first launched in the early 2000s, the price of four-room flats ranged from S$129,000 to S$205,000.
These owners saw the value of their homes tripling when they sold a decade later, with resale prices ranging from S$356,000 to S$650,000.
So Tengah residents willing to ride out daily inconveniences could enjoy a financial pay-off years later. Across the 18 BTO projects in Tengah, the median prices of four-room flats were below S$355,000, while five-room flats ranged between S$430,000 to S$485,000.
HDB resale prices have seen robust growth, though cooling measures implemented in recent years have moderated rates of increase. Should this trend continue, Tengah homeowners can expect to resell their flats at a profit in the next decade, barring unforeseen circumstances.
In this sense, BTO flats in non-mature estates can make a sound investment. Homeowners can enjoy first-mover advantage by reselling their flats once the town matures and their minimum occupation period (MOP) is complete.
But if your aim is not to flip your BTO for a profit, then these inconveniences may not be worth your while. If your finances permit, then you may be better off purchasing a smaller resale flat in a mature estate instead.