For Rent, Only To Needy

Source : TODAY, Thursday, January 3, 2008
Govt to review eligibility criteria for rental flats due to overwhelming demand

THE Government is looking at tightening the eligibility criteria for HDB’s subsidised rental flats to filter out those who “are not really in need of a flat”, National Development Minister Mah Bow Tan said yesterday.

This includes retirees with considerable funds after selling their flats or private properties.

Even with the Government looking to push out 2,194 new rental flats by 2010, there will still be a shortfall based on the waiting list for these one- and two-room flats, which currently stands at about 3,000.

Speaking after a visit to the first batch of newly-converted flats at Woodlands St 83, Mr Mah said: “There is always a strong demand for rental flats because they are heavily subsidised … there are people who try to get the rental flats even if they have other options. We are trying to manage the demand so that those who have other options don’t join the queue.”

Including the 180 units of rental flats at Woodlands, which were converted from three- and four-room flats previously used as dormitories for workers, the HDB manages more than 42,000 one- and two-room rental flats. The overall supply “should be able to meet genuine demand”, said Mr Mah.

Currently, the HDB allocates subsidised rental flats to families earning not more than $1,500 a month. Depending on their income and whether they have had a previous housing subsidy, these families pay $26 to $205 a month for a one-room flat, and $44 to $275 for two-room flats.

Not citing any specific figures, Mr Mah said that many applicants who meet the income eligibility, including retirees sitting on their money after monetising their properties, do not have to turn to rental flats as the last resort. Under the current regime, those in this group have to wait at least 30 months before they are eligible for a rented flat.

Adding that these retirees should look at purchasing studio apartments or consider renting spare rooms, he said: “The question we have to ask is if those who have sold off their flat or private property should be allowed to join the queue.

“Theoretically, today, you can sell off your bungalow and join the queue for a rental flat because you are retired and have zero income.”

Which is why there is a need to re-examine the existing “straightforward” criteria, he said, adding: “Even if we don’t bar them, we may just put them to the back of the queue.”

Members of Parliament also find themselves trying to discourage residents who want to rent a flat just because they cannot get along with family members, Mr Mah said. But a harder and more worrying problem to resolve is the impact of rising divorce rates on housing options, he added.

Said Mr Mah: “We are looking at more cases where couples break up and the flat has to be sold due to a court order. Either the husband or wife, with custody of the children, will not be able to afford a new flat and come to us for a rental flat.

“We’ll have to look at it from the more fundamental issue of why divorces are going up, and other things like housing options for a family that has broken up.”