1,700 flats surrendered to HDB in the past 5 years

[Homelander]

SINGAPORE: About 1,700 flats were surrendered to the Housing and Development Board (HDB) in the past five years, with most being short-lease flats, said Senior Minister of State for National Development Sim Ann on Tuesday (Mar 2).

 

She was responding to a Parliamentary question by MP Gan Thiam Poh (PAP-Ang Mo Kio) during the Ministry of National Development's Committee of Supply debate. 

 

Mr Gan had asked for the number of flats resold to HDB, the reason why the flats were resold, and if HDB would consider offering these flats on its open booking system.

 

Half of the surrendered flats were two-room flats, one-sixth were three-room flats and one-third were four-room or larger flats, said Ms Sim.

About 1,000 were short-lease flats, comprising studio apartments, two-room Flexi flats bought on a short lease and flats whose owners opted for the Lease Buyback Scheme.

 

“Owners of short-lease flats who no longer wished to retain their flats or who had become ineligible to do so, are required to surrender their flats to HDB. They are not allowed to sell them on the open market,” she said.

 

The remaining 700 flats were surrendered mostly due to changes in the owners’ circumstances within the minimum occupancy period, Ms Sim added. They were not allowed to sell their flats on the open market as they had not fulfilled their minimum occupancy period.

 

“The most common reasons for surrender of flats were divorce, break-up of fiance-fiancee relationship and annulment of marriage,” she said.

 

HDB compensates owners for surrendered flats, and sells them through the Sale of Balance Flats exercises. If they remain unselected, then they will be offered under open booking, said the senior minister of state.

 

In response to a supplementary question by MP Lim Biow Chuan (PAP-Mountbatten) on whether HDB could reduce the 5 per cent (of the flat's purchase price) penalty on surrendered flats, Ms Sim said that the penalty is to ensure that buyers understand that they are making a commitment to adhere to HDB’s eligibility conditions to own a flat.

 

Minimum occupancy periods are to deter speculative purchase, she noted. 

 

“Therefore, the reasons for the conditions that govern the surrender of flats is not so much determined by whether or not there is resale value to be had from those flats, but really to ensure that when flat owners enter into the commitment to purchase an HDB flat, they understand the eligibility conditions, that they will abide by it," she said. 

Edited March 2, 2021 by Homelander