Written Answer by Ministry of National Development on rationale for removing the concession allowing for a non-subsidised resale HDB flat to be used as transitional housing

Jul 6, 2021

Mr Chua Kheng Wee Louis: To ask the Minister for National Development (a) what is the rationale for removing the concession allowing for a non-subsidised resale HDB flat to be used as transitional housing; (b) when was the concession removed; and (c) whether the Government can reintroduce the concession and introduce other schemes in addition to the Parenthood Provisional Housing Scheme to support families’ immediate housing needs given further delays to ongoing BTO projects. 

Answer:

As HDB flats are primarily intended for long-term owner-occupation, we generally do not allow short-term ownership of HDB flats. Hence, HDB flat owners are required to fulfil a minimum occupation period (MOP) before they may rent out or sell their flat, or buy a private property. This safeguards HDB flats for households with genuine housing needs and deters speculative purchases of HDB flats.

HDB had previously made an exception for first-timer families who had booked an uncompleted HDB flat or Executive Condominium (EC) unit, by allowing such families to buy a non-subsidised resale flat as transitional housing, while waiting for their flat to be completed. These families then had to sell the non-subsidised flat once their booked HDB flat or EC unit was completed, without a need to fulfil the typical five-year MOP. Given our limited public housing supply, to better safeguard HDB flats for long-term owner-occupation, HDB stopped allowing non-subsidised resale flats to be used as transitional housing more than two years ago.

Flat buyers who are waiting for their new flats and require transitional housing are encouraged to find alternative housing arrangements with family members, relatives or on the open market. Where they are unable to do so, first-timer applicants who are waiting for their BTO flats can apply for temporary housing under the Parenthood Provisional Housing Scheme (PPHS). Given the limited supply and high demand for PPHS flats, we are considering ways to finetune allocation to give priority to families in greater need of temporary housing. We are also studying ways to increase the supply of temporary housing to better support affected flat buyers in need of housing. We will provide more details on these measures when ready. For low-income households with no family support and no other housing options, HDB will consider offering Interim Rental Housing (IRH) on a case-by-case basis. 

We recognise the challenges faced by flat buyers given the COVID-19 situation. We will consider waiving the forfeitures arising from flat buyers who cancel their BTO flats to buy a resale flat based on an assessment of their specific circumstances. This includes first-timer families with urgent housing needs who can consider buying a resale flat instead and receive up to $160,000 in housing grants. Resale flats are generally available for immediate occupation, and buyers can choose from a wide range of flats, according to their preferences and budget.

We will continue to monitor the situation carefully, and study ways to better support affected flat buyers in need of housing.