Tightened BTO selection rules with ‘safety valves’ will help genuine buyers: Desmond Lee

Waterway Sunrise II is progressively completed and flat buyers have started to collect the keys to their new home. ST PHOTO: CHONG JUN LIANG

SINGAPORE – Tightening rules on the selection of flats while also ensuring that there are “safety valves” for those with bona fide reasons for giving up their booking opportunity allows the Government to take a calibrated approach in supporting genuine home buyers, said National Development Minister Desmond Lee on Saturday.

Speaking to reporters on the sidelines of a visit to the Waterway Sunrise II Build-To-Order (BTO) project in Punggol, Mr Lee said the Government understands that there are legitimate circumstances in which people may forfeit the chance to book a flat, and the Government will be flexible “on a few spaces”.

Mr Lee had announced in Parliament on Thursday that first-timer applicants who do not select a BTO flat when invited to do so will be considered second-timers in subsequent flat applications for a year.

Currently, first-timers will be moved to the second-timer category for a year when balloting for flats only if they do not book a BTO flat twice.

HDB will waive the new rule – when it takes effect from August – only if applicants have 10 or fewer BTO flats to choose from.

Mr Lee told Parliament that the rules were tightened to reduce the number of people who decline to pick a flat and ensure more efficient allocation so that those who need a flat can secure one more quickly.

On Saturday, he said the “non-selection count” was in response to the concerns of Singaporeans that while there are many applicants “trying very hard to get a BTO flat”, including families and singles, up to 40 per cent of applicants each year do not book a flat when invited to do so.

“That 40 per cent is quite a large proportion,” said Mr Lee, while noting that many have legitimate reasons.

“They might find that the units are really on the low floor – very few options left. Some may find that some of the flats available that are left are beyond their budget – we understand that. Yet for others, life circumstances may have changed unexpectedly since they applied to the time that they are invited to select, and we also are very empathetic to that,” he said.

“But we also hear from Singaporeans, we also hear from my colleagues on the front line, that there are some applicants who had joined the queue, but they weren’t quite serious in wanting to apply,” said Mr Lee.

“We see that particularly in very, very good locations. We see a lot of interest, but also a lot of people dropping out because they really were just seeing whether they could get a number, and then they would decide there and then.”

Mr Lee said the Government is ramping up flat supply, but current demand is also high.

By March, the HDB is slated to complete 8,000 of the 20,000 flats that it had earlier said would be delivered in 2023.

Among the suggestions given by people in conversations with the Government on housing, said Mr Lee, “tightening the non-selection count while continuing to be flexible in a few spaces” and “understanding that some people have genuine reasons for not selecting a flat” strike the right balance.

National Development Minister Desmond Lee (right) visits Mr Daryl Pang’s flat at Waterway Sunrise II on March 4, 2023. ST PHOTO: CHONG JUN LIANG

Mr Lee was referring to dialogues with the public under Forward Singapore, an exercise to strengthen the nation’s social compact.

“And as to whether it will increase resale prices, I don’t particularly think so,” he said. In the wake of Thursday’s announcement, some have argued that first-timers who are bumped to second-timers will turn to buying a resale flat instead.

Mr Lee said the Government recognises that BTO flats are attractive and in demand, and wants to enact the new measures in a calibrated way – “tightening, but we also have safety valves for people with genuine reasons for not selecting”.

“We hope that that will give Singaporeans who are genuine home buyers a better opportunity to get those flats.”

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