45% of Homeowners with Both HDB and Private Properties Chose To Rent Out Their HDBs

About 3 per cent of Housing and Development Board (HDB) flat owners own at least one private residential property as at October 2022, falling about 0.3 percentage point in the last three years, said Minister for National Development Desmond Lee in Parliament on Monday (Nov 7).

“Of these, about 45 per cent are not living in the HDB flats as they’ve rented out their whole flat,” he added. “Another 4 per cent of HDB flat owners are renting out one or more bedrooms of the HDB flat.” Lee said that these proportions have remained stable in the last three years.

HDB Owners Without Private Properties: Only 13% Are Renting

Among the remaining 97 per cent of flat owners who do not own private residential property, about 13 per cent are renting out the whole flat or bedrooms within their flat, he said, noting that this figure has also stayed stable in the past three years.

Should Private Property Owners Dispose of Their HDBs?

Responding to Workers’ Party Member of Parliament Gerald Giam (Aljunied GRC) about whether the government will consider requiring HDB flat owners to sell or dispose of their HDB flats if they buy private property, Lee said that the government has been gathering views from Singaporeans and will study the topic seriously.

Giam asked a supplementary question about increasing the supply of resale flats to moderate resale flat prices, flagging that “resale flat prices have gone up about 28 per cent in the last two years, and this year alone between January and September, more than 266 flats sold for over S$1 million”.

“This has put resale flats beyond the reach of many Singaporeans, even after factoring in the generous government grants,” Giam said.

40 Million-Dollar HDBs Were Sold in October Alone

According to flash estimates for October, HDB resale prices overall advanced for the 28th straight month, with 40 million-dollar flats resold. The most expensive was a five-room Design, Build and Sell scheme unit at The Peak @ Toa Payoh, which went for nearly S$1.4 million. In September, there was a record-breaking 45 million-dollar flats sold.

In his response, Lee acknowledged the rising prices but reiterated the 3 per cent figure for those who simultaneously own HDB flats and private property, with those renting out their flats being “a smaller subset of that”.

Property Cooling Measures Were Enforced in September

“We’ve taken measures both in December last year and in September this year, to cool the property market by moderating demand and let the measures work their way through the market,” he said.

The government will also monitor the market carefully, as people are more prudent in their home purchases amid rising interest rates and uncertainty in the economic climate.

“Headline grabbing prices” that fuel market psychology also add to the impact on the resale market, Lee said, pointing out that million-dollar flats make up about 1 per cent of all resale transactions in the last two years, and tend to have “very good attributes”.

“Nevertheless, with grants as well as the measures we’re putting in place, we want to make sure that the property market remains in line with economic fundamentals.”

This story first appeared on The Business Times.