Government studying how to better support first-timer families looking to buy a HDB flat
HDB will increase the proportion of BTO flats with waiting times of under three years starting from 2024.
The Government is studying how to better support first-timer families looking to buy their first home, in light of the “high rejection rate” of Build-To-Order (BTO) flats, said Minister for National Development Desmond Lee in parliament on Monday (Feb 6).
Addressing unhappiness regarding the long waiting times for BTO flats, Mr Lee said the Housing Development Board (HDB) is working to catch up after the delays brought on by the COVID-19 pandemic.
HDB will increase the proportion of BTO flats with waiting times of under three years starting from 2024, with plans to launch between 2,000 and 3,000 of such flats annually from 2023.
Mr Lee also highlighted that 20,000 new homes were built last year, the highest number in the past 5 years. HDB has plans to release up to 23,000 new flats in 2023.
It will also consider more housing support for first-timers to buy resale flats, he said.
Mr Lee was speaking in a Parliament debate after filing a motion on affordable and accessible public housing. He had filed the motion in response to the one filed by Progress Singapore Party’s Non-Constituency Members of Parliament (NCMPs) Leong Mun Wai and Hazel Poa.
Mr Lee noted that BTO flat prices remained consistent amid increasing demand and construction cost, with the average price of a four-room BTO in a non-mature estate only increasing from $341,000 to $342,000 between 2019 and 2022.
He added that almost 70 per cent of BTO flats launched last year were considered affordable for the median Singaporean household income of $8,400, and that these households use “a quarter or less of their household income” to pay for the mortgage instalment.
Speaking in Parliament, Mr Leong called for a ‘reset’ to Singapore’s housing policies and proposed for land cost to be excluded from the pricing of HDB flats at time of purchase, and only paid to the Government when the flat is later sold.
He also proposed for a large stock of rental flats with short leases of two to five years to be set aside for young families and groups of singles. These “Millennial Apartments” should be in prime areas like the central business district, which will be close to the workplace and entertainment options to promote socialisation.
In response, Mr Lee explained that proceeds from land sales go back to the reserves, and not to current Government revenue for spending.
He said: “If HDB does not pay fair market value for state land, it means that we are reducing the value of the reserves and allocating more of it to today’s housing.
“By doing so we’re reducing the resources available to meet the needs of today’s generation as well as the needs for future generations.”