PM Lee announces new public housing model Plus: 'Choicer locations' but tighter resale restrictions

To keep home ownership affordable and the system fair for citizens, the Housing Development Board (HDB) will introduce, among other initiatives, a new Plus model for BTO flats at more popular locations, said Prime Minister Lee Hsien Loong.

Lee made this announcement during the National Day Rally at the Institute of Technical Education (ITE) headquarters in Ang Mo Kio on Sunday (Aug 20) evening. 

In his speech, PM lee said HDB keeps flat prices affordable by providing more housing grants, especially grants that are means-tested.

"This will work for most HDB projects, but it will still leave one particular problem: projects in choicer locations within a region," he added. 

For example, projects near the MRT station or the town centre see the highest demand during BTO exercises, and people know that HDB is offering a good deal as these flats will fetch much higher resale prices afterwards.

"This turns the BTO exercise into a lottery. Those who are lucky enough to ballot such a flat stand to reap a windfall upon resale," he said. 

"This will not be fair to the many more who miss out."

'Stricter sale conditions' to moderate prices: PM Lee

The solution, he added, is to introduce a new "Plus" model for selling HDB flats at choicer locations, with "stricter sale conditions so that we can moderate prices"

These Plus flats will be located within "choicier locations" within a region, and will have more subsidies and tighter restrictions than Standard BTO flats. 

"As we build more projects in mature areas, this Plus model will help us to meet our three objectives: affordability, good social mix, and fairness," he said.

"It will help Singaporeans find a house that suits your needs, even in good locations."

One such location is Bayshore in Bedok where the Plus flats will be a short walk to two MRT stations, a future shopping mall and Siglap CC. 

"We will have both private and public housing in Bayshore. The HDB projects will likely be Plus projects, and will be sold under different rules," said PM Lee. 

There will be more subsidies for Plus flats compared to Standard BTO flats - which will "moderate the prices of Plus flats and put them within reach of more households", he added. 

To make the scheme fair, these new flats under the Plus model will come with more restrictive sale conditions, including a longer Minimum Occupancy Period (MOP) of 10 years, and a subsidy recovery applied on the resale price of the flat "to take back the extra discounts". 

In addition, resale buyers looking to purchase these Plus flats will also have an income ceiling. 

"This will moderate resale prices and help to maintain a better social mix, even in the resale market in the longer term," said Lee. 

Standard, Plus and Prime

The Plus model, which will be implemented in the second half of 2024, comes as in addition to the existing Prime Location Public Housing Model (PLH), explained Lee. 

Hence, future flats will be be classified under Standard, Plus and Prime. This framework, however, will not affect existing projects. 

Standard flats will have HDB's standard subsidies and are subject to standard restrictions. 

Prime flats are in the choiciest and most central locations in Singapore, and have the most subsidies and tightest restrictions. 

The new framework would then achieve three objectives: keep home ownership affordable; maintain a good social mix in every town and region, and keep the system fair for everyone. 

No more mature and non-mature estates 

Since the early 90s, HDB has used a simple framework to guide the public in buying flats, distinguishing between mature estates and non-mature estates.

However, the housing landscape is evolving and there're fewer large tracts of undeveloped land left to build new towns and estates.

Tengah will be the last new town for quite some time, at least until Paya Lebar Air Base moves out to Changi and the site is cleared and redeveloped, PM Lee said.

"Increasingly, we will have to build new HDB flats within or near to existing estates. These will often be more centrally located," he added.

PM Lee pointed to how how non-mature estates today have become much more developed where towns like Jurong East, Woodlands and Punggol have matured, with a full suite of amenities.

The "blurring" distinction between mature and non-mature estates is also reflected in BTO applications, where some choicer projects in non-mature estates have become more popular than projects in mature estates.

"In future, many more BTO developments will be in estates or locations that are effectively "mature". This means that the framework of mature and non-mature estates will no longer work," he said. 

Singles to be able to buy Prime and Plus BTO flats

Separately, PM Lee also highlighted a "special group" when it comes to HDB housing policies - the singles.

He noted how "more and more Singaporeans are choosing to be single" and that "they too hope to own their homes, and have more housing choices".

Today, first-timer singles aged above 35 can apply for new flats, but only 2-room Flexi flats in non-mature estates.

And singles are also not allowed to buy Prime flats.

"These rules are to prioritise our limited supply of flats, but unfortunately, they have restricted singles' choices. And we will do something about this," he promised.

Under the new framework, singles will be able to buy 2-room Flexi flats across all types of BTO projects - Standard, Plus, and Prime.

"I am sure singles will welcome this move, to have more choices to find your own home. And write your own part in Singapore's housing story," he added.

Currently, single Singaporeans aged 35 and above can buy an HDB resale flat under the Single Singapore Citizen Scheme which was introduced in October 1991.

They're eligible to buy all flat types (excluding 3Gen flats) in any location.

Caring for Young Seniors and Forward SG

Besides addressing the issue of home ownership, PM Lee also announced the Majulah Package for ‘Young Seniors’ in his speech.

The package includes a CPF bonus of $1,000 a year for lower and middle-income workers; a one time-Retirement Savings Bonus of $1,500 for selected individuals, and a one-time MediSave Bonus of up to $1,000.

Lee also shared that despite "geopolitical tension and economic uncertainty", Singapore is "keeping up" economically, although inflation is likely to remain.

To "this increasingly troubled landscape", Lee spoke about the Forward SG movement, which was launched in June 2022 to refresh Singapore’s social compact.

"Our Forward SG plans include financial support for workers who lose your jobs, while you upgrade your skills.

"It will be a temporary safety net to help you meet immediate needs, to free you to upskill and train, as you prepare yourself for a good long-term job.

"So long as you are willing to make the effort, the Government will go the extra mile to help you upgrade yourself."

claudiatan@asiaone.com

No part of this story or photos can be reproduced without permission from AsiaOne.

For more original AsiaOne articles, visit here.