Written Answer by Ministry of National Development on government’s response to current pace of increase in HDB resale prices

Nov 2, 2021

Mr Chua Kheng Wee Louis: To ask the Minister for National Development (a) whether the current pace of HDB resale price increases, where the third quarter flash estimates of the Resale Price Index was up 12.3% year-on-year, is in line with the Government’s intent to ensure a stable and sustainable property market; and (b) what are the measures the Government is considering for implementation to improve housing affordability.   

Answer:

The Government is committed to ensuring a stable and sustainable property market where prices move broadly in line with economic fundamentals. The recent increase in prices can be partly attributed to a broad-based increase in demand for housing, supported by the current low interest rate environment.

HDB resale flats continue to remain affordable. On average, the mortgage servicing ratio, which is the proportion of monthly income used to service mortgage instalment payments, has remained stable at 23% among resale flat buyers taking an HDB housing loan, over the past 3 years. This means that first-timer buyers generally have little or no cash outlay in servicing the payments for their resale flats as their mortgage loans can be paid using their CPF contributions. The Government also provides housing grants of up to $160,000 to ensure resale flats remain affordable for eligible first-timer families.

To meet the demand for HDB flats, HDB is on track to launch about 17,000 Build-To-Order (BTO) flats in 2021, which is higher than the 14,600 and 16,800 flats launched in 2019 and 2020 respectively. Including the 5,300 flats offered under the Sale of Balance Flats exercises and open booking, a total of 22,300 flats will be offered in 2021. HDB will continue to ramp up the flat supply, and will launch more than 17,000 flats in 2022 to meet the strong demand.

At the same time, we are continuing to monitor the economic and property market conditions very closely, and will ensure that public housing remains affordable and accessible for Singaporeans.