APPLICATION FOR HDB RENTAL FLATS (Increase in income ceiling)

Mr Low Thia Khiang asked the Minister for National Development what is the rationale for setting the household income ceiling of $800 for eligibility to apply for Housing and Development Board rental flats; and whether he will consider increasing the ceiling to $1,200.

The Minister of State for National Development (Mr Lim Hng Kiang) (for the Minister for National Development): Mr Speaker, Sir, the Government's aim is to encourage as many Singaporeans as possible to own their flats, so that they can have a stake in the country. Thus, subsidised rental accommodation is limited to those households in the lower income group, with monthly incomes not exceeding $800, who genuinely cannot afford to purchase their own flats.

Households with incomes of more than $800 should be able to afford the monthly instalments for a new 4-room budget' HDB flat in New Towns like Choa Chu Kang, Jurong West and Woodlands. The average prices of the 4-room budget' flats in these New Towns range from $70,000 to $83,000. At such prices, the corresponding monthly instalments payable range from $255 to $300, and can be serviced entirely from the CPF contributions of households with incomes of as low as $850.

Those who find difficulty buying an HDB flat are provided with assistance under HDB's Low Income Incentive Scheme, whereby families with household incomes of $1,000 or less, buying a 4-room Simplified or smaller flat, are given a loan of up to 95% (instead of the usual 80%) of the selling price of the flat, and need only pay a downpayment of 5%.

My Ministry therefore does not see the need to revise the $800 income ceiling for rental flats for the time being.