National Development Minister Khaw Boon Wan’s comments that there would be a major relook at HDB policies, caused many people to be worried.
The part that got people worried was the part on a “return to the past when flats could only be sold to HDB, and not in the open market”.
The media has not conveyed the intent of this sentence inaccurately and Minister Khaw has since clarified it on his blog after receiving many querries on it:
I told her that I do plan to see how we can come up with a new housing option which can be a lot cheaper than today’s BTO price. And if we offer such a low-cost housing option, it must come with restrictions to differentiate it from the existing BTO flats. I mentioned some such restrictions as proposed by some MPs: longer minimum occupation period, shorter lease and no resale in the open market.
Obviously, if we offer such an option, these restrictions of a longer minimum occupation period, or shorter lease or no resale in the open market will only apply to the new buyers, and will not apply to existing flat owners like the Queenstown lady.
While this might be reassuring to existing owners, my personal take on this is that prices of current units would still be affected.
Resale prices are determined largely by demand and supply. If there is a flood of new units on the market that are cheaper, there will be lesser demand for resale units.
I hope the new categories and restrictions will not be overly complex. It can be confusing to many and become an administrative hassle to manage.
Instead of introducing changes that are too drastic, MND can tweak the demand and supply side of things.
At HDB’s end, it can ensure an adequate supply by building sufficient units to meet the needs of everyone.
On the demand side, it can restrict the people who can own and rent a HDB unit.
With adequate supply and moderate demand, prices of HDB units will be able to stabilize.