Resale rules for HDB Plus flats include S$14,000 income ceiling, 30-month wait for private home owners

SINGAPORE: Buyers of resale Housing Board Plus flats will be limited to Singaporeans with a household income ceiling of S$14,000. If they are private home owners, there will be a 30-month waiting period before they are allowed to buy these flats on the open market.

These resale restrictions were announced by Minister for National Development Desmond Lee on Monday (Aug 21), a day after Prime Minister Lee Hsien Loong introduced Plus as a new category of flats during his National Day Rally speech.

Build-to-Order (BTO) projects will fall under three categories - Standard, Plus and Prime - from the second half of 2024. This replaces the mature and non-mature framework that has been around since the early 1990s.

Plus flats will be in choicer locations such as near transport nodes or town centres.

They will come with more subsidies but also tighter resale conditions such as a minimum occupation period of 10 years before they can be put on the resale market.

Announcing more details at a post-National Day Rally conversation on Monday, the National Development Minister said that similar to the rules for Prime flats, owners of Plus flats will be subject to a subsidy recovery at the point of first resale.

"Because the Plus flats will enjoy lower subsidies than Prime flats, their subsidy recovery rate will also generally be lower," he added.

Owners of Plus flats will also not be allowed to rent out their entire flat at any time.

"This is to ensure owner occupation for such flats and deter those who intend to 'flip' the flats for quick gains or rent them out for long-term yields," Mr Lee said.

RESALE RESTRICTIONS

To keep the flats affordable beyond the first owners, there will be conditions for resale buyers to moderate demand and keep these homes affordable and inclusive over time, said Mr Lee.

There will be a 30-month wait-out period for private property owners, as well as a household income ceiling for resale buyers. 

For Plus flats, this is set at S$14,000 for both families and singles. This is the prevailing BTO income ceiling for married couples, which covers eight in 10 Singaporean households.

It is higher than the BTO income ceiling for singles, which is S$7,000. 

Except for the subsidy recovery which will only apply to the first owners, these conditions will apply to subsequent buyers to keep flats affordable beyond first sale, the minister said.

"Many Singaporeans tell us that they are willing to pay more for a flat in a good location. The Plus model helps make such flats affordable to a wider range of Singaporeans," he said.

MORE OPTIONS FOR PARENTS, MARRIED COUPLES

With the new classification of flats from next year, first-timer parents and married couples will be able to get first priority across all Standard flats islandwide.

This gives them more options under the priority scheme beyond the current selection of four-room or smaller flats in non-mature estates.

"This means that first-timer parents and married couples should be able to select a flat after fewer attempts and have more choice, in more locations," Mr Lee said.

There will be no change to the treatment of existing HDB flats, which will continue under current rules such as having a five-year minimum occupation period. 

"This means that Singaporeans who fall outside of the S$14,000 income ceiling will still have access to the existing 1.1 million flats and Standard flats as they enter the resale market," he added.

Mr Lee said his ministry has engaged more than 16,000 Singaporeans over the past year as part of the Forward Singapore exercise.

These conversations helped to reaffirm the key principles of public housing - to keep home ownership affordable, maintain a good social mix and keep the system fair, he added.

Keeping public flats affordable "gives Singaporeans a tangible stake in our country", he said. "It also allows us to sink roots, build our families, connect to community."

The system must also be fair, he emphasised, noting that public housing should primarily be for owner occupation and not speculative investment.