INCREASE OF HDB LOAN TENURE IN VIEW OF DELAYS IN CONSTRUCTION OF HDB FLATS AND RISE IN HDB RESALE PRICES

Mr. Murali Pillai asked the Minister for National Development having regard to the current short supply of HDB BTO units caused by the COVID-19 pandemic and the rising prices of HDB resale flats making it more difficult for buyers to afford them, whether the HDB loan tenure may be increased from 25 years to 30 years.

Mr. Desmond Lee: Buying a HDB flat is a long-term financial commitment. The maximum loan tenure for HDB housing loans is set at 25 years to encourage financial prudence among flat buyers. This is especially important in the current climate of rising housing prices.

While a longer loan tenure may increase the loan amount or lower the monthly instalment payable, flat buyers will pay more in interest over the duration of the loan. Such a move will also inject liquidity into the resale market, which may fuel property prices.

To ensure that resale flats remain affordable, HDB provides up to $160,000 in housing grants for eligible first-timer families. With regard to the supply of new flats, HDB is on track to launch about 17,000 Build-to-Order (BTO) flats this year. This is higher than the 14,600 and 16,800 flats launched in 2019 and 2020 respectively. Balance flats, which are offered via Sale of Balance Flats exercises and open booking of flats, will further supplement our housing supply.

We will continue to monitor the market situation closely, and remain committed to ensuring that public housing remains affordable and accessible for Singaporeans.

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

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Murali Pillai

Murali Pillai

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

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