HDB InfoWeb : Policy Changes To Support An Inclusive And Cohesive Home

Date issued : 05 Mar 2010

The Minister for National Development, Mr Mah Bow Tan, announced in Parliament today housing policy changes to encourage Singapore Permanent Residents (SPRs) to take up citizenship, a new quota to promote social integration of SPR households in public housing estates, and a revision to the Ethnic Integration Policy to accommodate Singapore’s changing demographics.


PART A: PROMOTING CITIZENSHIP IN HDB HOUSEHOLDS

2 With globalisation, an increasing number of SPRs are joining our community as long-term residents. SPRs contribute economically and socially to building our society, and it is in our country’s interests for them to sink their roots here permanently. Hence we would like to encourage SPRs to take up Singapore citizenship.


Reinforcing the Privileges of Citizenship


3 HDB facilitates home ownership by providing generous subsidies. Today, SPRs married to Singapore Citizens (SCs) enjoy the same subsidies as Singaporean couples. We would like to encourage the SPR family members in such SC/SPR households to take up citizenship.


4 To do this and to reinforce the privilege of citizenship, HDB will withhold $10,000 of the housing subsidies enjoyed by SC/SPR households when they buy a flat. If they buy a resale flat, a Design, Build and Sell Scheme (DBSS) flat, or an Executive Condominium (EC), their Housing Grant will be reduced by $10,000. If they buy a new flat, they will have to pay a $10,000 premium on top of HDB’s selling price. The changes are summarised in Table 1.





5 The withheld subsidy of $10,000 will be restored when an SPR family member in the SC/SPR household takes up citizenship or if the couple has an SC child while still in ownership of that flat. Eligible households can apply to HDB within 6 months of the change in household citizenship status to claim the $10,000 Citizen Top-Up via CPF.


PART B: ENCOURAGING SOCIAL INTEGRATION - QUOTA FOR SPR HOUSEHOLDS


6 SPRs are long-term residents in Singapore. It is important that they integrate well in our local communities. Social integration is a key policy objective in our public housing system. In line with this, HDB will introduce a new SPR quota for non-Malaysian SPR families buying flats, to facilitate better integration and to prevent enclaves from forming in public housing estates.


How does the SPR quota work?

7 The SPR quota will be set at 5% and 8% at the neighbourhood and block levels respectively. It will apply in addition to the existing Ethnic Integration Policy (EIP) limits. The SPR quota takes into account the composition of SCs and SPRs in Singapore, and their respective demand for public housing. Malaysian SPRs will not be subject to the SPR quota, in view of their close cultural and historical similarities with Singaporeans.


8 The SPR Quota caps the proportion of non-Malaysian SPR households in HDB neighbourhoods and blocks. Similar to EIP, any resale resulting in an increase in SPR proportion will not be allowed, if the neighbourhood/block limit is already reached. Under such circumstances, an SC seller or a Malaysian SPR seller would not be able to sell his flat to a non-Malaysian SPR household. However, a non-Malaysian SPR seller would still be able to sell to another non-Malaysian SPR as this would not increase the number of non-Malaysian SPR households.


PART C: REVISION TO THE ETHNIC INTEGRATION POLICY (EIP)


9 The EIP was implemented in 1989 to ensure a balanced ethnic mix across HDB estates and to prevent the formation of racial enclaves.


10 In response to Singapore’s changing demographics, HDB will increase the limits for the Indian/Others ethnic group by two percentage points to 12% at the neighbourhood level and 15% at the block level. The current Indian/Others limits are 10% and 13% for neighbourhood and block respectively. There is no change to the limits for the Chinese and Malay ethnic groups as the current limits are sufficient. The revised ethnic limits are given in Table 2 below:





Implementation Date and Enquiries

11 The above housing policy changes will be implemented with immediate effect. More details can be found in Annexes A-C (PDF 16KB).

12 For enquiries, public can contact HDB through the following channels:


(a) Sales/Resale Customer Service Line : 1800 8663 066


(b) Branch Office Service Line : 1800 2255 432


(c) SERS Enquiry Line : 1800 8663 070

HDB InfoWeb : Lease Buyback Scheme To Benefit More Elderly HDB Households

Date issued : 05 Mar 2010

More elderly households can look forward to benefitting from the Lease Buyback Scheme (LBS). Minister for National Development, Mr Mah Bow Tan, announced in Parliament today the expansion of the LBS, which will make 3,800 more elderly households living in 3-room or smaller flats eligible for the scheme. The changes will be implemented from 1 April 2010.



Background


2 The LBS was launched on 1 March 2009 to help elderly households in 3-room and smaller flats unlock their housing equity to supplement their retirement needs. These households need more help as they are unlikely to be able to take advantage of existing monetisation options, such as right-sizing to a smaller flat or subletting a room. Under the LBS, the elderly will get to continue to live in their homes, while receiving a lifelong income stream.

Expansion of LBS

3 With effect from 1 Apr 2010, the LBS will be extended to the following two groups of elderly households living in 3-room or smaller flats:

a) Those who previously owned 4-room or bigger flats. Although they would have received substantial proceeds from the sale of their earlier flats, some of them could still be in need of help eg. those who had downsized many years ago. These elderly may now apply for LBS, and enjoy a Government subsidy of $5,0001.


b) Those with outstanding housing loan of more than $5,000, but will have minimum proceeds of $60,000 for the purchase of an Immediate Annuity under CPF LIFE if they take up LBS. This allows those with sufficient equity to purchase an annuity plan, even after deducting their outstanding loan of more than $5,000, to benefit from the LBS2.


4 With these changes, the revised LBS eligibility criteria are -


a) Citizen household living in a 3-room or smaller HDB flat;
b) All lessees are at least at the CPF draw-down-age, currently at 62 years old;
c) The household must not have enjoyed more than one housing subsidy in the past;
d) The household must have lived in their flat for at least 5 years;
e) The monthly household income must not exceed $3,000;
f) The household must not have owned or currently own a private residential property; and

g) The household must not have any outstanding housing loan on their flat that exceeds $5,000 unless they have minimum proceeds of $60,000 for the purchase of an Immediate Annuity under CPF LIFE.

5 With the expansion of the LBS, the number of beneficiaries will increase, from the seven in ten to eight in ten elderly households. Under the previous criteria, about 31,000 elderly households in 3-room and smaller flats (or 73% of elderly households in 3-room and smaller flats) were eligible for LBS. With the revision, the number of elderly households that stand to benefit increases to 34,800 (or 82% of elderly households in 3-room and smaller flats), i.e. an increase by 3,800 households (or increase by 12%).


6 An illustration on how LBS would benefit the elderly is attached at Annex A (PDF 45KB).


Enquiries


7 For further information or enquiries, the public can:


- visit HDB InfoWEB at www.hdb.gov.sg


- call the toll-free LBS Hotline at 1800-5556363 or Branch Office Service Line at 1800-2255432 on weekdays from 8.00 am to 5.00 pm


Note:
1 Other categories of LBS lessees who have not previously owned 4-room or bigger flats enjoy subsidy of $10,000.
2 Under LBS, the upfront cash payout is $5,000 and it is used to offset the outstanding loan in the first instance. Therefore, they will not be able to enjoy any cash payout if outstanding loan exceeds $5000.

HDB InfoWeb : Reinforcing Owner-Occupation Among HDB Flat Owners

Date issued : 05 Mar 2010

The Minister for National Development, Mr Mah Bow Tan, announced in Parliament today that HDB will be raising the Minimum Occupation Period (MOP) for the resale of non-subsidised HDB flats from 1 and 2.5 years to 3 years. The objective is to reinforce owner-occupation.


2 HDB flats are primarily meant to provide owners with a roof over their heads. They are not meant for speculation or short-term profit. Hence, lessees are required to stay in their flat for a minimum period before they may sell their flat in the open market. Currently, lessees of subsidized HDB flats, i.e. HDB flats bought directly from HDB, DBSS flats bought from private developers or resale flats bought with CPF housing grant, are subject to an MOP of 5 years. On the other hand, lessees of non-subsidised HDB flats i.e. resale flats bought without CPF Housing Grant, are subject to the following MOP:


a) Those who take an HDB concessionary loan – 2.5 years


b) Those who take a bank loan or do not take a loan – 1 year


3 To reinforce the principle of owner-occupation, the MOP for resale of non-subsidised flats will be increased to 3 years, regardless of whether the buyer takes an HDB loan, a bank loan or no loan at all. With the extension of MOP, the demand in the resale market will also more accurately reflect the interest from buyers who are buying flats for occupation.


4 The revised MOP policy will apply to resale transactions where applications are received by HDB from 5 Mar 2010 onwards. Existing lessees of non-subsidised flats will not be affected, i.e. the original MOP of 2.5 or 1 year continues to apply to them. There are also no changes to the MOP for subletting of whole flats.


ENQUIRIES


5 For enquiries, the public can contact HDB as follows:


(a) Sales/Resale Customer Service Line : 1800 8663 066


(b) Branch Office Service Line : 1800 2255 432


(c) SERS Enquiry Line : 1800 8663 070

HDB Circular: Measures To Ensure A Stable And Sustainable Property Market‏

Date : 20 Feb 2010





Mr Jeffhery Foo
President, Institute of Estate Agents


Dear Mr Jeffhery Foo,

MEASURES TO ENSURE A STABLE AND SUSTAINABLE PROPERTY MARKET

The government has announced the following measures to ensure a stable and sustainable property market, to take effect from 20 Feb 2010:

a. Introducing a Seller’s Stamp Duty (SSD) on all residential properties and residential lands that are bought from 20 Feb 2010 and sold within 1 year from the date of purchase; and

b. Lowering the Loan-to-Value (LTV) limit to 80% for all housing loans provided by financial institutions regulated by the Monetary Authority of Singapore (MAS).

EFFECT OF MEASURES ON HDB FLATS

(A) SELLER'S STAMP DUTY (SSD)

2 The SSD will not be applicable to HDB flats (including flats sold under the Design, Build and Sell (DBSS) Scheme), as they are already subject to a minimum occupation period of at least one year. It will apply to Executive Condominiums and HUDC flats that are purchased on the resale market, as they are not subject to a minimum occupation period.

(B) LOWERING OF LOAN-TO-VALUE (LTV) LIMIT TO 80% FOR HOUSING LOANS

3 The 80% LTV limit will apply only to housing loans taken from banks/financial institutions, for transactions where the Option to Purchase (OTP) was granted on or after 20 Feb 2010, or if there is no OTP, where the date of the sale and purchase agreement falls on or after 20 February 2010.

4 Housing Loans granted by HDB for HDB flats (including DBSS flats) will still have an LTV cap of 90%.

PRESS RELEASE

5 Details of the measures are in the attached Press Release:

http://www.mnd.gov.sg/newsroom/newsreleases/2010/news19022010.htm

6 Please disseminate the information to your members.

Thank you.

Head, Resale Planning Unit
Housing & Development Board