HDB clamps down on illegal rentals and removes listings from its resale portal + what happens when HDB repossesses a flat

In recent years, the Housing and Development Board (HDB) of Singapore has taken action against numerous flat owners for violating lease agreements. While the issue has been widely reported in the past, it seems there are still some homeowners willing to take the gamble just to earn extra cash from their property. From 2019 to 2023, approximately 800 cases of infractions were addressed, with penalties ranging from warnings to fines and, in severe cases, compulsory acquisition of the property.

The HDB reported that around 70 flats were repossessed due to serious breaches of lease terms. These violations included unauthorised rentals, failure to occupy the flat during the mandatory Minimum Occupation Period (MOP), and acquiring private property interests while subject to MOP restrictions.

Approximately half of the cases resulted in written warnings, while about 330 flat owners faced fines up to $50,000. The remaining cases led to the HDB reclaiming ownership of the flats.

This information comes amid recent media focus on short-term rentals in Singapore. HDB emphasised that its enforcement actions have remained consistent over the past five years. To detect infractions, HDB conducts regular inspections, investigates public reports, and monitors property listings. Between 2019 and 2023, the board performed 29,000 inspections and looked into 4,400 cases based on public feedback.

HDB highlighted three notable cases of compulsory acquisition. In one instance, a couple advertised their unoccupied five-room flat for sale during the MOP. Another case involved a flat owner renting out their entire unit without authorisation. The third case concerned a couple who indirectly acquired a private property during their flat's MOP.

The board reiterated that HDB flats are primarily intended for owner-occupation, with strict rules to prevent misuse. Flat owners must physically reside in their units during the MOP before being allowed to sell or rent them out. Additionally, flat owners and their family members are prohibited from acquiring interests in private residential properties during this period. HDB stressed the importance of obtaining approval before renting out units or bedrooms and adhering to tenancy regulations, including limits on the number of tenants. For partial rentals, owners must continue to live in the flat alongside their tenants.

What Happens When HDB Repossesses a Flat?

When HDB repossesses a flat, homeowners face significant consequences. Firstly, they lose ownership of the property, which is taken back by the HDB. This can severely impact the homeowner's financial situation, as they not only lose their home but also any equity built up in the property.

Homeowners are typically required to vacate the premises within a stipulated timeframe. Failure to do so can lead to legal actions, including eviction. The repossessed flats are then put back on the market by the HDB, either through direct sales or allocation to eligible buyers on the waiting list.

In addition to losing their property, homeowners may face restrictions on future housing purchases. They might be barred from buying another HDB flat for a certain period and could also be ineligible for housing grants or subsidies. This ensures the integrity of the public housing system and deters future infractions.

Listings Removed from the HDB Resale Portal

On July 11, nearly two months after the launch of its HDB Flat Portal, about 50 listings for resale Housing Board flats were removed from the platform due to unrealistic pricing or misleading information. These accounted for approximately 5 percent of the total active listings as of June 26, HDB stated on July 10. Since its soft launch on May 13, about 1,000 resale flats have been listed on the portal.

HDB noted that around half of the removed listings were due to unrealistic pricing, though they did not provide further details. Eight of these listings were reinstated after users adjusted their asking prices.

The HDB asserted its right to moderate listings on the resale flat listing service and to remove any inappropriate or inaccurate content without prior notice. For a listing to be reinstated on the portal, sellers or their property agents must revise the listing price or correct any misleading information. However, HDB did not elaborate on the specific types of misinformation that led to the removal of some listings.

By monitoring and removing listings with unrealistic pricing or inaccurate information, HDB aims to maintain a fair and transparent market environment. This measure protects the interests of both buyers and sellers, ensuring the resale market operates smoothly and without artificial inflation of property values.

HDB's proactive measures in monitoring lease agreements and resale listings underscore its commitment to maintaining the integrity and affordability of public housing in Singapore. Through strict enforcement and market regulation, the HDB ensures that its policies serve the broader community effectively.