HDB's Reply

15-month wait-out scheme prioritises public housing for those with genuine needs
Date: 21 Oct 2022

We refer to the recent Forum letters on the 15-month wait-out period for private residential property owners and former owners buying resale Housing Board flats.

We thank the writers for their feedback and acknowledge the diverse views raised in the letters, which demonstrate the wide range of housing needs and aspirations of Singaporeans.

The number of private property owners buying HDB resale flats has doubled in the last three years.

Compared with first-time home buyers or existing HDB owners, these owners generally have more financial means from the sale proceeds of their private property.

Hence, they tend to pay higher amounts of cash over valuation when buying resale flats to secure the flat they want.

To moderate demand and ensure that resale flats remain affordable for flat buyers, especially first-timers, we introduced a 15-month wait-out period before private property owners are allowed to purchase a non-subsidised HDB resale flat.

This helps to prioritise public housing for Singaporeans with more urgent housing needs. This is a temporary measure, which we will review depending on overall demand and market changes.

Nonetheless, we recognise that not all private property owners are in the same situation.

Some seniors need to sell their private property and right-size to an HDB flat to support their retirement needs. Hence, seniors above 55 who are moving from a private property to a four-room or smaller resale flat are exempted from the wait-out period.

Those with extenuating circumstances can also approach HDB for assistance.

For example, for those who obtained an option to purchase to buy an HDB resale flat before the cooling measures were implemented on Sept 30, HDB will exercise flexibility and waive the 15-month wait-out period for buyers with documentary proof.

HDB flats are first and foremost meant for owner occupation.

Hence, HDB flat owners are not allowed to concurrently own any private property during their flat’s minimum occupation period.

This serves to dampen demand, deter the speculative purchase of HDB flats, and prioritise them for those with genuine housing needs.

We are monitoring the property market closely, and will continue to adjust our policies to keep public housing affordable and accessible to Singaporeans.

Sia Tze Ming
Director (Policy & Property)
Housing & Development Board

Letters to The Straits Times

Don’t curb aspirations of those who want to be self-sufficient
Date: 11 Oct 2022

From: Frankie Mao

I refer to Mr Heng Yan Lin's letter, "Study other factors driving up HDB resale prices" (Oct 8).

Property ownership and property investment are significant issues facing Singaporeans today, young and old alike.

It's a serious matter that warrants analysis, critical thinking and a holistic approach.

In recent months, the purchase of HDB properties has also been subjected to penalties and restrictions, causing pain and anxiety to many who genuinely want to downgrade to finance their own retirement lifestyles without relying too much on public help. Isn't that a good thing, and why should they be penalised?

Others want to take charge of their financial needs by investing in another property that can generate additional income for their later years. Again, shouldn't this be encouraged as it frees the Government from welfare responsibility?

Blanket taxes, stamp duties and penalties do little to help such Singaporeans with genuine needs who want to be self-sufficient.

There has to be a more holistic and far-sighted approach to tackle property issues to address present and future needs instead of a piecemeal way to penalise Singaporeans who have good intent.

Don’t let HDB flats be used to amass wealth
Date: 11 Oct 2022

From: Goh Puay Hoon

I agree with Forum writer Ng Beng Choo (Don't let people own HDB flat and private property at the same time, Oct 4).

Under the current rules, which do not stop a person who owns a Housing Board flat from buying a private property, many HDB flat owners have gone on to purchase private properties.

They continue to hold on to the HDB flat, as they know that once they sell it, they will not be able to buy one again while they still own a private property.

I knew of a few friends who rent out their flat and use the rental income to service their private property purchases. One friend lives in a semi-detached house and owns several overseas properties, and has been collecting rental income from an HDB flat for a few decades.

With nothing done to correct this situation, many owners will never give up their HDB flat since the law doesn't require them to. They will generate rental income while also investing in private properties.

I'm quite perplexed as to why this is allowed, while the reverse is forbidden. Since such owners have enough wealth to afford private properties, why should they still be allowed to own a subsidised flat and use it as a cash cow?

HDB flat owners who go on to purchase a private property should have to sell their HDB flat since they no longer require a subsidised home, thus making more flats available in the market.

I hope HDB will review the current rules so that more flats can go to those who really require a roof over their heads, and not those who use them to amass more wealth.

Restricting HDB owners will push up rents, prices in private residential market
Date: 8 Oct 2022

From: Cheryl Tan Cher Lin

I refer to the letter by Mr Ng Beng Choo (Don't let people own HDB flat and private property at the same time, Oct 4).

All HDB flat owners must occupy the flat for a minimum of five years, or 10 years in the case of prime location public housing flats.

Only Singapore citizens are allowed to rent out their whole HDB flats.

The pool of HDB flats in the rental market provides accommodation for non-citizens such as students or workers who may not have the budget to rent private apartments.

The Government already has policies in place to curb property speculation, such as the additional buyer's stamp duty to purchase additional properties.

To forbid citizens to own an HDB flat and a private property at the same time will not only kill the aspirations of many Singaporeans, but also result in a shift of market behaviour where the supply of HDB flats available for rent is reduced, thus increasing the demand in the private residential market.

This will definitely push rents and property prices in the private residential market higher.

Segregation and division in the housing patterns may also widen the gap between locals and foreigners and prevent foreigners from experiencing the neighbourliness and kampung spirit of heartland living in our HDB estates.

Study other factors driving up HDB resale prices
Date: 8 Oct 2022

From: Heng Yan Lin

In Singapore, property is considered a safe investment haven. It is natural that many young Singaporeans choose to preserve their wealth through property investment.

Hence, suggestions such as additional purchase taxes and disallowing married couples to buy private property singly are both misguided and punitive for Singaporeans who invest in properties to preserve their wealth and not to speculate (Try options other than wait-out period, Oct 4).

There are Singaporeans who are looking to grow their retirement nest egg by selling their private property and buying an HDB flat . If an individual has already sold his private property and has no other property to live in, he should be allowed to buy an HDB flat without a 15-month wait.

In addressing the overheated HDB resale market, it is important to look at other factors. There are property agents who go door to door to solicit and convince home owners to sell their flats by promising great returns. There is the valuation of the unit that guides the selling price, and also the cash over valuation that is unregulated.

I urge the Government to relook this matter and study the many factors driving price hikes in the HDB resale market.

On Facebook: Should flat owners who buy a private property be required to sell their flat first?
Date: 8 Oct 2022

From: Darryl Ye

Yes... there should be some form of income tax on people who rent out HDB flats. An HDB flat should be first and foremost an owner-occupied property.

From: Christopher Soh

There are forward planners who own both an HDB flat and private property. This is a form of securing our retirement. Doesn’t this group of working class people also deserve a comfortable retirement after slogging for so long?

From: Lilian Chua

Just like private property owners are not allowed to own HDB flats, I think the same should apply to HDB flat owners as well. Besides, HDB flats are heavily subsidised and it is not reasonable that one should continue to benefit from these subsidies when he can now afford to own a private property. When the demand for public housing outstrips the supply, why should HDB flat owners who can afford to buy a second property continue to hold two properties and benefit from both subsidy and rental?

Don’t let people own HDB flat and private property at the same time
Date: 4 Oct 2022

From: Ng Beng Choo

The latest property cooling measures seem to create another set of issues.

Those who genuinely cannot afford to own a home and have been renting may have to face higher rent, in competition with those waiting out the 15-month period after selling their private properties (New cooling measures: Tighter housing loans, 15-month wait for private home owners to buy HDB flats, Sept 30).

Drastic steps need to be taken now to help every Singaporean to own a home.

No one in Singapore should be allowed to own an HDB flat and a private property at the same time.

It doesn't seem logical that a person who owns a private property cannot buy a resale flat, but a person who owns an HDB flat can buy a private property and rent one of the properties out.

A flat owner who buys a private property should be required to sell the flat. He should not be able to live in the private property while using the HDB flat as a cash cow.

These cooling measures will fatten the cow even further.

Try options other than wait-out period
Date: 4 Oct 2022

From: Ee Teck Siew

In the latest property cooling measures, private home owners will now have to wait 15 months after selling their homes before they are allowed to buy a resale flat, a temporary measure to moderate demand for resale flats (New cooling measures: Tighter housing loans, 15-month wait for private home owners to buy HDB flats, Sept 30).

I am baffled by this measure and the rationale given for it.

First, these aspiring resale flat buyers are already not allowed to own any other property in Singapore or overseas, and would therefore be buying the resale flat for occupation.

Second, while million-dollar resale flat transactions have been making headlines, quite a number involve very large apartments which may not necessarily translate to a very high price on a per square foot basis.

Finally, some private property owners are actually making a fiscally prudent decision to downgrade.

Maybe we should implement other property cooling measures.

First, prohibit spouses from purchasing properties under their separate names.

Second, implement capital gains tax on all property gains except for owner-occupied properties.

Third, revise the annual value of properties more frequently than once a year, and increase property tax rates for non-owner-occupied properties.

Finally, build more HDB flats in non-mature estates, and accelerate the construction progress so that first-time owners have a higher chance of getting their dream homes at a more affordable price.

Nevertheless, I applaud the Government for not applying the wait-out period to buyers aged 55 and above if they are buying a four-room or smaller resale flat, and to those buying a two-room flexi-flat on short lease or a community care apartment.

Given the geopolitical uncertainties, global inflation, tight monetary conditions and rising interest rates, we must exercise prudence in our financial affairs, especially for a big-ticket transaction like buying a property.

Buying properties for the purpose of investment should be done using a company, with taxes paid accordingly.

Ultimately, Singapore is a land-scarce place, and we must not become like Hong Kong where property prices are out of reach of many.