Wedding bells are ringing, and BTO prices are good. Seems like a great time to apply for a house, doesn't it? While we can never predict if a couple may be happily attached today but break up the next, one thing is for sure: never base your relationship on the availability (and price) of a HDB BTO flat.
In 2013, figures show that over 22% of those who applied for a BTO house in 2009, had cancelled in the next four years. So what happens to the 5% down payment (paid when buyers signed the Agreement for Lease) when a couple has broken up? Unfortunately, this means nursing a broken heart as well as a burn in the pocket.
Signed BTO Agreement for Lease
“For buyers whose flat applications are cancelled after they have signed the Agreement for Lease (which sets out the sale terms of the HDB flat for buying a flat) and paid the down payment, an amount equivalent to 5% of the flat purchase price will be forfeited,” says the HDB.
1-Year Wait Out Period
In addition, the buyers will not be allowed to apply or be included as an essential occupier for a new HDB flat/ DBSS flat/ Executive Condominium unit or a resale HDB flat with housing grants, within 1 year from the date of cancellation. Effective for sales exercises from March 2012 onwards, this is to prevent “frivolous” HDB BTO flat-buyers from hogging spots in the queue.
Return Housing Grants
If the couple are first-timers and had been given CPF Housing Grants, they also have to return the full amount with interest. This has to be paid up before you can apply or be included as an essential occupier for a new HDB flat/ DBSS flat/ Executive Condominium unit or a resale HDB flat with housing grants, in future. Also, the buyers' household status (i.e. first-timer or second-timer) will be assessed at the time of your application.
Pay 5% Forfeit Fees
Desiree Lim, 23, and her boyfriend Jason Ong, 25, had applied for a BTO flat near her parents’ place, but broke up months later. That decision will cost them a five-figure sum as they’d already chosen their HDB BTO flat and made their down payment. “We should have considered more carefully before we applied. Since new housing projects don’t come by often, especially near my parents’ place, we felt the pressure to quickly apply for it,” reflects Desiree. “The sad thing is that this is pretty common among couples.”