First-time BTO applicants who give up chance to select flat will lose priority status
About 40 per cent of HDB BTO applicants do not book a flat when invited to do so.
SINGAPORE: Applicants who fail to select a Housing Board Build-to-Order (BTO) flat despite being successful at the balloting stage will face tighter restrictions from August this year, announced Minister for National Development Desmond Lee on Thursday (Mar 2).
This is to ensure more efficient allocation so that those who need a home can secure their flats more quickly, the Ministry of National Development (MND) and the Housing and Development Board (HDB) said in a press release.
About 40 per cent of BTO applicants do not book a flat when invited to do so. They either do not turn up or decline to book a flat at their selection appointments, said authorities.
“There is probably a range of reasons. For some, the remaining flats may be out of their budget. For others, they might be considering other housing options, or prefer flats with specific attributes,” said Mr Lee in Parliament at his ministry's Committee of Supply debate.
“Understandably, some would rather give up the opportunity to select a flat now, and wait longer for a better flat. But whatever the reason, such applicants do crowd out other home buyers who may have more pressing needs.”
Currently, such applicants are penalised if they accumulate two non-selection counts, and are considered second-timers for a year during the balloting exercise.
But from the August 2023 BTO exercise, first-timers who fail to choose a flat once will be deemed second-timers for a year in the computer ballot. Second-timers who accumulate one non-selection count, down from the current two counts, will have to wait one year before they can apply for a flat again.
First-time family applicants have a better chance at balloting as they get two ballot chances while second-time family applicants are given one. Also, up to 95 per cent of HDB’s BTO or Sales of Balance Flat (SBF) supply is set aside for first-timer families.
The contrast is clearly seen in application rates at each BTO launch where the number of second-timers vying for each flat is far higher. For example, in the November 2022 BTO exercise, there were 1.9 first-time applicants versus 16.2 second-time applicants for each four-room BTO flat at housing estates in Tengah.
First-timer families also get an additional ballot chance for every subsequent BTO application in the non-mature estates if they had been unsuccessful two or more times.
MND and HDB said they also recognise that there may be instances when applicants are left with very limited choices when they are invited to book their flats. HDB will thus waive the non-selection count for applicants with 10 or fewer BTO flats to choose from; or five or fewer SBF flats to choose from.
Mr Lee added that some applicants might also turn down the offer to select a flat because their circumstances have changed unexpectedly since they applied for the flat. Where there are extenuating circumstances, HDB may exercise flexibility to waive the non-selection count, he said.
"The tightened rules for non-selection of flats seek to strike a balance between considering the interests of flat applicants with urgent housing needs, while being fair to applicants who have been successful in their flat balloting process," the agencies said.
"HDB flats are heavily subsidised and in demand. We strongly encourage all applicants to carefully consider when they should apply for a new flat, and book a flat when invited to do so."
THREE BALLOT CHANCES FOR SOME FIRST-TIMERS
Mr Lee also provided more details on another initiative to help first-time family applicants who urgently need a home, which had been announced during the Budget on Feb 14.
Also starting from the August BTO exercise, first-timer families who have children or are married couples aged 40 and below will get three ballot chances, and enjoy higher priority in BTO and SBF exercises.
HDB and MND said that the first-timer category covers a wide range of applicants, including those who already have their own homes, but have not benefited from housing subsidies.
The new priority category, known as the First-Timer (Parents & Married Couples) category, or FT(PMC), constitutes about 10 per cent of all first-time family applicants.
The eligibility criteria for the FT(PMC) category are:
- Families with at least one Singapore citizen child aged 18 and below or married couples aged 40 and below
- Have never owned a residential property before
- Did not have a chance to book a BTO or SBF flat by HDB, in the past five years
They will also get priority under an expanded scheme for families.
Under the current Parenthood Priority Scheme, up to 30 per cent of the BTO flat supply and up to 50 per cent of the SBF supply are reserved for first-timer married couples with at least one Singaporean child aged 18 and below or who are expecting a child.
The scheme will be expanded to include FT(PMC) applicants, and will be renamed the Family and Parenthood Priority Scheme. Up to 40 per cent of the BTO flat supply and up to 60 per cent of the SBF supply will be reserved for FT(PMC) families.
FT(PMC) applicants for four-room and smaller BTO flats in non-mature estates will also be given first priority for the flats set aside under the Family and Parenthood Priority Scheme.
"With these new changes, first-timer parents and married couples should be able to select a flat within fewer attempts, especially if they apply for a four-room or smaller BTO flat in the non-mature estates where demand tends to be more moderate," said Mr Lee.
These measures are on top of an increase in the CPF Housing Grant amount for eligible first-timer families and singles to buy resale flats, announced by Deputy Prime Minister and Finance Minister Lawrence Wong during his Budget speech.
Addressing concerns from MPs about whether the grants could push up resale flat prices even more, Mr Lee acknowledged that there is always this risk when grants are increased in a buoyant resale environment.
But MND decided to move on this given the “current context”, he said.
HDB has significantly ramped up the supply of BTO flats, and the Government has introduced two rounds of cooling measures, which are working their way through the market, he pointed out.
HDB launched more than 23,000 flats last year and will launch around the same number this year.
Mr Lee also said that across both the private sector and public market, close to 100,000 homes will be completed between 2023 and 2025.
In addition, the outlook for the broader economic environment remains extremely uncertain, and mortgage interest rates have increased, he noted.
“With these in mind, we made a considered decision to increase the CPF Housing Grant and give targeted support to eligible first-timers, who made up about one-third of all resale flat buyers in the past two years," Mr Lee said.
"It does not apply universally to the entire resale market, but only a very specific group.”
MORE COMMUNITY CARE APARTMENTS
A third tranche of Community Care Apartments (CCAs) will be launched at Bedok for seniors, after the first two pilots were well-received, authorities said.
CCAs integrate senior-friendly housing with care services that can be customised according to a person’s care needs.
The first CCA pilot, Harmony Village @ Bukit Batok, was launched in February 2021 and the second, Queensway Canopy, was launched in November last year.
The Bedok development will have about 200 CCA units, alongside other flat types, as well as social and communal facilities. There amenities nearby include active ageing centres, community centres, markets and hawker centres.
Mr Lee said that more CCAs will be launched in other locations, and that more details will be announced when ready.
“We are also partnering the private sector to co-create innovative assisted living models that can cater to seniors’ diverse preferences and lifestyles,” said Minister of State for National Development Faishal Ibrahim, giving the example of a pilot private assisted-living site at Parry Avenue put up for sale in September last year.
For lower-income singles eligible for public rental housing, HDB will provide more options for them, said Assoc Prof Faishal.
The Joint Singles Scheme Operator-Run pilot was launched in December 2021 to provide an additional option for singles to apply for a public rental flat on their own, without first having to find a flatmate.
Under this pilot, HDB appoints an operator to manage the flat-sharing arrangements, provide social support to tenants and mediate among tenants when needed.
All three Joint Singles Scheme Operator-Run sites – Bedok, Buangkok and Bukit Batok – are close to their full occupancy of 400 tenants in total, said Assoc Prof Faishal.
This scheme will be expanded to Bukit Panjang, Bidadari and Sengkang, and the three new sites will be able to accommodate about 600 tenants.
HOUSING SYSTEM REFINED OVER TIME
National Development Minister Mr Lee told the House that MND has continued to refine its system over the years and today’s housing model comprises BTO flats, Shorter Waiting Time flats, Sale of Balance flats, and flats offered under open booking.
This combination allows HDB to “dynamically adjust” building plans in response to demand.
“The current system may not always work perfectly, and we will continue to adjust and calibrate along the way.
"But it does strike a reasonable balance across multiple objectives – fairness and efficiency in allocating flats, fiscal prudence, and responsiveness to demand,” said Mr Lee.
“Compared to its predecessors, the pure BTO model and Registration of Flats System, I think it is a clear improvement.”