CREATION OF TRUST OVER HDB FLAT AND PROTECTING PARENTS’ INTERESTS WHEN RELATIONS BREAK DOWN

Murali Pillai
3 min readFeb 7, 2024

For private properties, it is not uncommon for these properties to be subject to trust interest or proprietary estoppel. For HDB property, however, it is statutorily provided that HDB flats cannot be subject to trusts unless HDB agrees. From time to time, I have come across cases of parents selling their homes to provide funding for properties to be purchased in the names of their children. Often, the quid pro quo is for the parents to be cared for in their children’s homes. Often, their names as authorised occupants are used to get higher priority (3G flats) for HDB flat allocation. Sometimes, however, things don’t work out. I personally handled a case whereby an elderly mother, who sold her flat and provided the proceeds to her son, was asked to leave her son’s flat after she had a serious quarrel with her daughter in law. The mother sought a HDB public rental flat. It was indeed a sad case. If the property was a private property, there could be at least an argument that the mother may raise proprietary estoppel to prevent her son from ejecting her. I therefore enquired with the Minister for National Development about the frequency of HDB’s discretion use under section 58(9) of the Housing Development Act in the last five years, specifically regarding the approval for creating a trust over an HDB flat. Furthermore, I explored the possibility of HDB allowing the creation of trust interests favouring parents who financially assist their children in purchasing flats, providing them security in family disputes. My parliamentary question and Minister Desmond Lee’s response are set out below.

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Mr Murali Pillai asked the Minister for National Development (a) in the past five years, on how many occasions did HDB exercise its discretion under section 58(9) of the Housing Development Act to provide approval for a trust to be created over a HDB flat; and (b) whether HDB will consider allowing the creation of a trust interest which favours parents who provide monies to their children to buy a flat in return for being able to live together, to protect these parents when relations break down.

Mr Desmond Lee: Under section 58(9) of the Housing and Development Act, no trust may be created over a HDB flat without HDB’s prior written approval. This is to prevent parties from making use of trusts to circumvent HDB’s rules.

On a case-by-case basis, HDB may allow the creation of a trust over a HDB flat, such as in favour of a minor child beneficiary following the demise or divorce of the parents, or if the flat owners are mentally incapacitated. Where a trust is created for a minor child beneficiary, the flat must be transferred to the child once he/she reaches the eligibility age of 21 years old to own the flat. This is in pursuant to the Civil Law Act that a person must be of full age (i.e. aged 21 and above) to have the capacity to enter into a contract for the sale, purchase, mortgage, assignment or settlement of any land, among others.

Over the past five years, HDB has approved 99 requests for the creation of a trust over a HDB flat.

Parents who plan to provide monies for their children to buy a HDB flat in return for living together, have the option to co-own the flat with their children, if they meet the prevailing eligibility conditions. This is a more direct way of protecting the parents’ interests in situations such as the breakdown of parent-child relations, so there is no need for parents to set up trusts for this purpose.

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Murali Pillai

Member of Parliament, Bukit Batok SMC, Advisor to Bukit Batok SMC GROs.