Posted: 14 March 2013 1242 hrs

SINGAPORE

National Development Minister Khaw Boon Wan said his ministry plans to see how it can come up with a new housing option which can be a lot cheaper than today’s prices for Build-To-Order (BTO) flats.

He said if such a low-cost housing option is offered, there must be restrictions to differentiate it from the existing BTO flats.

Some restrictions proposed by a few MPs include a longer minimum occupation period, shorter lease and no resale in the open market.

In a blog post, Mr Khaw spoke about meeting a lady who lived in Queenstown but went all the way to Sembawang for his Meet-the-People’s session.

Mr Khaw said the lady had not slept well since she heard the news that the Ministry of National Development (MND) may stop the resale of HDB flats in the open market, and that all resale would be to HDB only.

She has a fully paid up a three-room flat and had booked a new BTO flat in Bukit Panjang which will be ready in a couple of years’ time.

She has done her sum and expects to have a sizeable net cash proceeds for her retirement fund.

Mr Khaw told her she had completely misunderstood what he had said in Parliament.

He said MND wants to provide affordable housing for new home owners, especially young couples, but will not forget the interest of existing home owners, some of whom plan to rely on their flat to finance retirement needs.

Some hope to bequeath their flats to the next generation. Some rely on renting out a room to bring in extra cash proceeds. Their concerns, Mr Khaw said, matter to him too.

Mr Khaw said if the new housing option is offered, the restrictions will only apply to new buyers.

He assured the lady from Queenstown that her dream is safe and that she could now look forward to both a new BTO flat and a significant retirement fund.

Mr Khaw also invited flat owners who have not been voicing their views publicly to join “Our Singapore Conversation” to articulate their concerns when housing policies are discussed.

He said if flat owners who form the vast majority remain silent, discussions on housing policies may be wrongly skewed.

One analyst Channel NewsAsia spoke to welcomed the government’s move to provide a cheaper housing option to Singaporeans.

He said this will ensure that all Singaporean families will have a roof over their heads, especially those in the lower-income group.

However, he added that some caveats might include not being able to lease out the flat after the Minimum Occupation Period is over and a lower income cap.

This will ensure that the system is not abused and the flat is truly for the owner’s own occupation.

Eugene Lim, ERA Realty Network’s key executive officer, said: “Based on the latest BTO prices, to buy a three-room flat in a non-mature estate, your income should be at least near to S$2,000.

“In a mature estate, it’s way over S$2,000. So we suspect that there’ll be an income cap on this, and the income ceiling will be about S$2,000 or below.”

– CNA/fa/al