ASSISTANCE TO YOUNG COUPLES TO OWN HDB FLATS

Dr S. Vasoo asked the Minister for National Development whether further changes will be made to help young couples solve their housing problems and meet the financial outlay to own a Housing and Development Board flat.

The Minister for National Development (Mr Mah Bow Tan): Mr Speaker, Sir, the average waiting time for a new HDB flat now is about one year for first-timer applicants. This has benefited many young couples who want to set up their homes early.

To assist in the purchase of flats, HDB has introduced a Staggered Downpayment Scheme. Under this scheme, first-timer young couples who have booked a 4-room flat can pay only 10% of the selling price at the time of booking, and the balance 10% upon completion of the flat. This gives the young couples more time to save for the downpayment. Applicants for a 5-room flat may also request to switch to a 4-room flat register so as to buy a flat that is more affordable to them.

HDB is also looking into other ways to make its flat allocation system more flexible and responsive to the needs of flat applicants. HDB will announce the details once they are finalized.

Dr S. Vasoo (Tanjong Pagar): May I ask the Minister whether he would be prepared to review the staggered instalment payment further because the time span now is one year and they may not accumulate enough money by then. Secondly, I am also thinking of young couples who want to live in older housing estates. Is the Minister prepared to look at the whole issue of cash outlay by younger couples who want to stay near to their parents in older housing estates?

Mr Mah Bow Tan: Sir, there is a general rule of thumb that before anybody purchases a flat the couple must have a certain amount upfront, either in cash or CPF. But we do recognise that the 20% down payment, for some young couples, especially in cases where the flat is completed early or they are shortlisted for application sooner than they expected, there may be some difficulty in accumulating that 20%, and this is the reason why we came up with the Staggered Downpayment Scheme.

The Staggered Downpayment Scheme has got certain restrictions. The flat type must be a smaller flat and, secondly, there must be a certain age restriction as well. But the general principle does apply that you need to have something upfront before you can actually apply for a flat. This is the reason why the scheme is not applicable to the 5-room flats because obviously the question of affordability may not be so relevant there. But the Member did ask whether this scheme would be applicable to resale flats, especially where young couples want to move into certain areas for certain reasons.

For resale flats, if you are a first-timer and if you are a young couple, you can avail yourself of the CPF Housing Grant Scheme. I think that already helps to a large extent to make that flat more affordable. Other than that, there are no other schemes at the moment which they can make use of. But if the Member has any suggestions, I would be happy to consider them.