Parliament: 900 flat buyers cancelled BTO bookings in 2018

About 900 flat buyers cancelled their Build-To-Order (BTO) bookings with the Housing Board last year because they could no longer afford the unit, changed their minds about moving or had bought a resale flat.

Of the cancelled bookings, 38 per cent were for four-room flats, 25 per cent for two-room flexi or similar units, and 22 per cent for five-room flats. The remaining 15 per cent were for three-room homes.

National Development Minister Lawrence Wong gave these figures in Parliament yesterday when replying to Mr Ang Wei Neng (Jurong GRC).

Mr Wong also said those who cancel their bookings before signing the lease agreement will forfeit the booking fee, which ranges from $500 to $2,000, depending on the flat type. Those who cancel after signing the lease agreement forfeit 5 per cent of the flat price, he added. "They would also need to wait a year before they may apply for another subsidised flat."

He explained that the measures are to make sure buyers are serious about buying a flat, and that they "do not deprive others who are in urgent need of buying a flat".

On a case-by-case basis, HDB has waived the forfeiture when buyers cancelled on valid grounds, he said.

Flats given up by prospective buyers will be sold in the sale-of-balance exercises, Mr Wong said in his reply to Mr Lim Biow Chuan (Mountbatten).

Ms Denise Phua (Jalan Besar GRC) asked about the help HDB home owners can receive when they face difficulties in selling their flats because of the Ethnic Integration Policy. Mr Wong said that "very often, we find that by giving more time to complete the transaction of the new flat and to sell the existing flat they are able to proceed".

Those who still face difficulties after the extension should approach HDB for help, he added.

Replying to a separate question filed by Mr Faisal Manap (Aljunied GRC), Mr Wong said the land cost for HDB home projects awarded in 2016 and 2017 was about 60 per cent of total development cost.

The proportion was about the same for three-room, four-room and five-room BTO flats, he added.

Other costs include construction, consultancy fees and financing. Proportions vary among projects, depending on various factors, including design and market, he added.

"In general, HDB's total development cost cannot be fully covered from the sale price of flats," said Mr Wong. "This is because the pricing of new HDB flats is guided by our objective of keeping public housing affordable."

This article was first published in The Straits Times. Permission required for reproduction.