Slightly more than half of first-timer applicants invited to book a flat under HDB's Built-To-Order system between May 2008 and June 2009 did not book a flat, although this rejection rate is lower than before HDB refined its BTO application process in May last year.

That fine tuning saw HDB removing first-timer priority for those who had turned down two chances to select a flat.

Ninety per cent of flats in each BTO project are set aside for those who have first-timer priority.

HDB issued figures yesterday to debunk the perception that a high number of applications for BTO projects equates to urgent housing need, given the relatively still high rates of rejections by first-time applicants.

The average rejection rates furnished by HDB yesterday refer to BTO flats in non-mature estates, where the vast majority of such flats are located, and exclude studio apartments. HDB's figures yesterday showed that between March 2007 and March 2008, before the application process was refined, 9,088 or 67 per cent of the 13,605 first-timer applicants invited to make their selection did not book a flat. Between May 2008 and June 2009, the rejection rate had fallen to 52 per cent or 6,747 of the 13,080 first-timer applicants invited.

The rejection rate for first-half 2009 has declined to 45 per cent.

Reasons cited by applicants who did not book a flat include that their preferred units had already been taken up, they are reconsidering other housing options and the completion dates for the BTO projects are too long.

HDB also sought to debunk the perception that BTO applicants often made numerous unsuccessful attempts, pointing out that there is an 80 per cent chance of success for first-timer applicants to be invited to select a BTO flat. And the success rate of first-timer applicants being invited for flat selection within two tries is 96 per cent.

The BTO system remains the major source of supply of new HDB flats. HDB starts building flats in a BTO project only after it achieves a certain level of demand. Feedback from some potential buyers is that the three to four years it takes for the new flats to be built under BTO is too long. HDB officials urged young couples setting up home to plan ahead for their new flat purchases and apply for BTO flats under the existing fiance-fiancee scheme before they even get married.

Meanwhile, there has been strong demand for the 2,132 flats, which are either completed or nearing completion, that were launched on Oct 1 under the new Sales of Balance Flats scheme. As at 5 pm yesterday, 13,741 applications had been received. Applications close on Oct 14.

HDB is also ramping up the supply of BTO flats to be launched for the whole of this year, from 8,000 units planned previously to 9,000 units. With close to 4,000 BTO units launched in the first nine months of 2009, another 5,000 units in eight projects will be launched for application in Q4 this year. This month, HDB will release a project each in Sengkang and Jurong West, followed by two projects in Punggol next month, and four in December - including two in Dawson and one each in Bukit Panjang and Sembawang.

National Development Minister Mah Bow Tan, who spoke to reporters yesterday after visiting HDB sales counters, reiterated that the supply of new flats under the BTO programme is more than adequate.

He urged potential buyers including newly married couples to look for workable solutions and to weigh the trade-offs if they can't find a flat in a mature estate where their parents live.

He also said HDB takes into account additional demand for resale HDB flats from the influx of permanent residents when it builds new flats as these units will eventually filter into the resale market.

This article was first published in The Business Times.