THE Housing Board will not raise the $8,000 income ceiling for first-time buyers of HDB flats, despite numerous calls from MPs and the public for it to do so.
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The reason: The income criteria capture some eight in 10 Singaporean families, including upper middle-income earners, said National Development Minister Mah Bow Tan yesterday.‘I hope Members will agree with me this is more than generous and will not be surprised if I tell them HDB has no plans to revise the income ceiling,’ he added.
His reply during the debate on his ministry’s budget was sparked by calls from MPs such as Mr Christopher de Souza (Holland-Bukit Timah GRC) during the debate earlier in the week on the Finance Minister’s Budget statement.
Mr de Souza said buyers, especially young couples, had no access to affordable housing if they earned more than $8,000.
Mr Mah acknowledged HDB resale prices saw ‘heady’ growth of about 17 per cent last year. But he did not expect the spike to continue.
There are other affordable alternatives for such couples, he said, citing the resale market in executive flats.
Mr Mah also assured Singaporeans that the Government will ensure HDB flats remain within reach of the vast majority, especially young couples seeking to buy their first home. For instance, they will get more chances in balloting exercises for new flats.
On average, the Government spent $1.4 billion a year over the last five years on public housing. In the coming 2008 financial year, it has set aside $1.6 billion.
The vast sums are spent on providing Singaporeans with various housing types to meet changing aspiration and various needs, said Mr Mah as he detailed HDB plans, policies and programmes.
Affordable housing
NEW HDB flats are priced below market value. And the subsidy for first-time buyers can go up to $88,000.
As a result, first-time home owners last year used, on average, only 20 per cent of their monthly income to pay their home loan.
This is well within the 30 per cent benchmark for affordability.
Also, at least 70 per cent do not fork out cash from their pockets each month but settle their mortgage entirely with their CPF contributions.
Many choices
THREE more sites will be offered to private developers to build condo-style flats, under HDB’s Design, Build and Sell scheme.
It will bring the total of such HDB flats to around 4,000 units, to cater to families who can afford to pay more.
But Mr Mah stressed that HDB-built flats will still be the mainstay of new flat supply.
Sufficient supply
ABOUT 700 new flats in Punggol and Sengkang are still available for purchase, said Mr Mah, who allayed concerns over whether supply is enough to meet growing demand.
HDB builds flats only if buyers show firm commitment, in the form of a deposit. It started the practice following a glut of unsold flats in the 1990s.
This build-to-order scheme has not reduced supply. Some 10,500 flats have been launched since last year, and HDB will continue to do more of such projects.
Mr Mah also assured the House that getting a new flat was not a case of tikam-tikam (’trying your luck’), a phrase Mr Baey Yam Keng (Tanjong Pagar GRC) used of couples who came to see him when they could not get flats.
Mr Mah said his checks with HDB showed in the past six years, only 250 were still unsuccessful after taking part in more than four HDB sales exercises. ‘This is less than 1 per cent of first-timer applicants applying for a new HDB flat,’ he said. Also, four out of five of the 250 applied only for homes in established towns.
Such outcomes, Mr Mah said, are why he repeatedly advises young couples to be flexible and go for new flats in newer towns or resale flats.
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