Leong Sze Hian
Why are Permanent Residents (PRs) who are single buying HDB resale flats like nobody’s business?
Singaporeans who are single and below age 35 are not allowed to buy HDB resale flats unless they are orphans.
PRs sibings who are single and below 35, however, are allowed to purchase these flats.
Why does our public housing policy favour PRs over Singaporeans? Is it not discriminatory and unfair?
Has any Members of Parliament ever raised this issue vigorously in Parliament?
The mission of the HDB should be to help Singaporeans own homes. So, how can single PRs be given priority over Singaporeans?
If you are a below-35 PR in Singapore, wouldn’t you try to arrange for one of your siblings to come to work in Singapore too, and apply for permanent residency?
Whilst there are no official statistics on how many HDB flats are owned by single PRs, anecdoctal evidence seems to suggest that an increasing number of single PRs may be buying them.
As there are also no official statistics on how many single PR siblings are in Singapore, it may probably not be too far an estimate to say that there may be tens of thousands in total.
When one of the PR siblings leave Singapore, after a resale flat has been purchased, are they still allowed to keep the flat? I believe the answer is yes, at least for a few years.
The cheapest HDB 3-room flat (2 bed-rooms) that a single Singaporean or PR can rent is about S$1,500. With housing loan interest rates at historical lows in Singapore, the monthly repayment for a $220,000 HDB bank loan is only just over $800.
So, is it any wonder why it may make more sense for single PR siblings to buy a resale HDB flat, instead of renting one?
3, 4 and 5-room HDB resale flats are going for around $280,000, $370,000 and $440,000 (median sale prices), respectively, with a typical down-payment of 20 per cent of the purchase price.
PR siblings can sell their resale HDB flats after a Minimum Occupation Period of 5 years. So, from a financial perspective, it may make more sense to buy than to rent, and possibly reap the capital gains as well after 5 years.
The increasing “headache” for some Singaporeans may be that they cannot afford the Cash-Over-Valuation (COV) on a resale flat.
Since PR siblings when they first come to Singapore typically do not have permanent residency status yet, they do not need to contribute to CPF. Thus, they generally may have more cash to pay for COV because their take-home pay is higher without CPF contributions relative to Singaporeans, until such time that they become PRs and qualify to buy HDB resale flats.
Even when they become PRs, the first 2 years’ CPF contribution is lower than for citizens.
2 PR siblings may generally just need to stay in one bedroom.
So, some may rent out rooms immediately after they buy a flat. [PRs can rent out rooms immediately but not the entire flat.] The PR sibling owners can stay in 1 room themselves, and rent the rest of the rooms out. Under HDB rules, you are allowed to have up to 9 persons staying in say a 5-room (4 bed-room flat). So one can rent out to 7 persons, at say $150 per person.
Some PR siblings may also be accustomed to sharing a flat before they buy their resale flat.
So, they may be able to pay higher prices for resale HDB flats, because they plan to rent out the rooms for income.
Singaporeans, on the other hand, generally buy flats to stay without the intention to rent out rooms immediately.
I think most Singaporeans see a HDB flat as their home for life, and not as a temporary investment, providing income as well as saving on housing costs whilst in Singapore.
Are these some of the possible contributing factors to why HDB resale prices have been skyrocketing?
In this connection, HDB resale prices rose about 75 per cent over the last 5 years, compared to a lower appreciation for the private property price index.
HDB policies could be reviewed, with a focus on the undesirable outcomes for Singaporeans, and at the same time vis-a-vis PRs.
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Read also: HDB flats – S’poreans come first?
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There are so many abuses/loopholes going on regarding HDB flats. Flat owners shouldn’t be allowed to buy private property, and they shouldn’t be allowed to rent out their HDB flats. Period.
PRs and foreigners on employment passes who want to rent, rent direct from HDB. PRs who want to buy HDB flats should be citizens of this country first.
No MOP and all that crap. Public housing should be for ordinary citizens of this country, it shouldn’t be a source of extra income for those who own private properties, nor should they become sources of income for greedy PRs who do not live in the flats but elsewhere.
y’all are whiners.. i see Singaporeans as whiners.. you are blessed with so many things here in Singapore.. but what y’all do is just whine about being unfair.. unfair this, unfair that.. if you got something to whine about, go straight to the government and not on this page! your government obviously hears you– why can’t you see how lucky you are to be here and how well-protected you are? compared with other countries (where foreigners are from of course).. everything is unfair to you.. everything works against you.. foreigners are preferred, and you blame the government for your lack of job but you can’t even haul up your ass to look for one. you see foreigners breaking the law but in fact i see very young singaporeans smoking within school hours in the basketball court, making out in the park, eating and drinking inside the bus, sitting in priority seats.. get yourself together man.. peace!
i noticed that foreieners who come to work in Singapore and who are IT qualified are able to rent a flat direct from JTC. Subsequently they take up PR citizenship.
In my hdb block, they went for lift upgrading and instead of paying for the lift upgrading, JTC decided to offer these 3 room flats to the tenants for sale.
This PR tenant bought it and rented out his whole flat immediately, legaally or illegally i do not know. he sent home his children and wife. he alone stayed in singapore but where the neighbours do not know.
so this is another loophole we should be looking at!
from
singaporean
The rules now make it much too easy for PRs to purchase HDB resale flats. This only makes it harder for Singaporeans to own or rent properties in their own country.
The current HDB resale rules could be tightened.
A new scheme can also be considered: Houseing COEs. If there are COEs for car ownership, there could be Housing COEs (just for foreigners: PRs and passholders) on flat ownership (HDB and private). Potential purchasers of flats (landed could be outside the scheme) would first have to bid for Housing COE and be in possession of one before they can complete the purchasse of a flat.
Certain categories of foreigners will be ineligible to bid including domestic workers, construction workers, those with a criminal record, those who have lived abroad for more than 1 year out of last 5 years, and other categories which the policy makers may decide.
The scheme can be rolled out so that it would only apply to new purchases, and PRs and foreigners who already own flats could be exempt. Of course if they decide to purchase, then they would have to bid for a housing COE.
Why can’t a single buy a new 3-room Hdb flat.The price for a resale flat is how many percent higher then the new one.
The married one can get new one. What about those who is not married can they afford to buy.The couple who is working can easily afford it. Whereas the single alone have to take the burden.And also singaporean married a foreigner without Pr can’t get new flat.I can’t buy a resale flat if the price carry on going up like this.Hopefully can get new flat which is much more cheaper.
I think government should put aside a certain % of the new flats for single to ballot.
I am also a poor 48 years old single who can’t afford an expensive flat. Why no action was taken to care for us?
HDB’s new rules to curb speculation and encourage PRs to take up citizenship
- explains why PRs have priority
Votes man, it’s votes that matters.
In case you are unaware, the minister in charge is Malaysia-born. He did the same with SIA.
Guess you are right, more than 70% of HDB bought/allocated to foreigners/PRs.