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05-04-12, 14:20
http://www.straitstimes.com/PrimeNews/Story/STIStory_782903.html
One-year HDB ban for cancelling flat bookings
Board tightens rules after seeing rise in number of cancellations
Published on Mar 29, 2012
By Jessica Cheam, Housing Correspondent
EVEN as the Housing Board (HDB) rolls out more flats and relaxes eligibility rules to expand choices for buyers, it now wants applicants to be very sure of what they want before booking a unit.
If they change their mind after putting down an option fee, they will now be barred from buying new Build-to-Order (BTO) or resale flats with housing grants for a year.
The ban also extends to new Design, Build and Sell Scheme (DBSS) units and executive condominiums.
HDB said yesterday the changes take immediate effect and apply to its latest bumper launch of 8,000 flats islandwide, comprising 4,153 new BTO units and 3,825 leftover types from previous sales exercises.
HDB yesterday also relaxed the eligibility rules for two-room flats in mature estates, raising the monthly household income ceiling to $5,000 from $2,000.
It said it has observed a steady increase in the number of cancellations - from 309 in 2007 to 1,540 last year - which make up about 5 per cent to 6 per cent of its Build-to-Order supply each year over that period.
It said one of the reasons was the higher supply of new BTO flats. Applicants who cancelled cited reasons such as a change in housing plan, or preference to live in another location. It added, however, that the one-year penalty would be waived 'in exceptional circumstances beyond the control of the applicants'.
Currently, upon booking the flat, buyers pay an option fee that ranges from $250 for a studio apartment to $2,000 for a four-room flat or bigger. The amount is forfeited if they change their mind.
Property agency PropNex chief executive Mohamed Ismail said the one-year ban is 'understandable and fair' as 1,500 cancellations are a large number.
The recent ramp-up of new-flat supply means buyers have more choices and this move would encourage them 'to take a more serious approach before committing to a home', he added.
HDB's latest move further tightens its application process.
In 2008, it had introduced a 'two strikes and you're out' approach to discourage those who were not serious.
Under this rule, first-time buyers who reject an offer to buy a flat twice or more in any HDB sales exercise - implying the buyers did not turn up to select a flat - lose their first-timer priority for a year. This effectively moves them to the back of the queue with second-timers.
While eligibility rules for two-room flats have been relaxed, the HDB said the income ceiling for such units in non-mature estates will remain at $2,000 - to safeguard a supply for the lower-income.
HDB told The Straits Times that currently, about 70 per cent of its applicants have a monthly household income of $5,000 and below. Its latest move follows those earlier last year to increase the monthly income ceiling for three-room standard flats in non-mature estates to $5,000 from $3,000.
Last August, it also raised the monthly income ceiling for other types of three-room and bigger flats to $10,000 from $8,000.
PropNex's Mr Ismail said the latest move is unlikely to make a big impact on the market as the number of two-room flats offered is typically small.
HDB's latest launch of 8,000 flats comes in the wake of a recent string of initiatives to ease demand among certain buyers and forge closer family ties.
The launch, which received huge interest, caused a slowdown at HDB's website yesterday morning.
Buyers accessing the new projects were told the site was too busy or had only intermittent access. There were also reports of huge crowds at the HDB Hub in Toa Payoh who had turned up to get more information or submit applications.
Commenting on the latest moves, home buyer L.W. Koh, 28, said that even though he now qualifies to buy a two-room flat, the option is not for him as such homes 'are too small'.
But the civil servant welcomes the move to ban buyers who are not serious about their purchases as 'this deprives buyers like me who have not had a chance to select a flat'.
[email protected]
One-year HDB ban for cancelling flat bookings
Board tightens rules after seeing rise in number of cancellations
Published on Mar 29, 2012
By Jessica Cheam, Housing Correspondent
EVEN as the Housing Board (HDB) rolls out more flats and relaxes eligibility rules to expand choices for buyers, it now wants applicants to be very sure of what they want before booking a unit.
If they change their mind after putting down an option fee, they will now be barred from buying new Build-to-Order (BTO) or resale flats with housing grants for a year.
The ban also extends to new Design, Build and Sell Scheme (DBSS) units and executive condominiums.
HDB said yesterday the changes take immediate effect and apply to its latest bumper launch of 8,000 flats islandwide, comprising 4,153 new BTO units and 3,825 leftover types from previous sales exercises.
HDB yesterday also relaxed the eligibility rules for two-room flats in mature estates, raising the monthly household income ceiling to $5,000 from $2,000.
It said it has observed a steady increase in the number of cancellations - from 309 in 2007 to 1,540 last year - which make up about 5 per cent to 6 per cent of its Build-to-Order supply each year over that period.
It said one of the reasons was the higher supply of new BTO flats. Applicants who cancelled cited reasons such as a change in housing plan, or preference to live in another location. It added, however, that the one-year penalty would be waived 'in exceptional circumstances beyond the control of the applicants'.
Currently, upon booking the flat, buyers pay an option fee that ranges from $250 for a studio apartment to $2,000 for a four-room flat or bigger. The amount is forfeited if they change their mind.
Property agency PropNex chief executive Mohamed Ismail said the one-year ban is 'understandable and fair' as 1,500 cancellations are a large number.
The recent ramp-up of new-flat supply means buyers have more choices and this move would encourage them 'to take a more serious approach before committing to a home', he added.
HDB's latest move further tightens its application process.
In 2008, it had introduced a 'two strikes and you're out' approach to discourage those who were not serious.
Under this rule, first-time buyers who reject an offer to buy a flat twice or more in any HDB sales exercise - implying the buyers did not turn up to select a flat - lose their first-timer priority for a year. This effectively moves them to the back of the queue with second-timers.
While eligibility rules for two-room flats have been relaxed, the HDB said the income ceiling for such units in non-mature estates will remain at $2,000 - to safeguard a supply for the lower-income.
HDB told The Straits Times that currently, about 70 per cent of its applicants have a monthly household income of $5,000 and below. Its latest move follows those earlier last year to increase the monthly income ceiling for three-room standard flats in non-mature estates to $5,000 from $3,000.
Last August, it also raised the monthly income ceiling for other types of three-room and bigger flats to $10,000 from $8,000.
PropNex's Mr Ismail said the latest move is unlikely to make a big impact on the market as the number of two-room flats offered is typically small.
HDB's latest launch of 8,000 flats comes in the wake of a recent string of initiatives to ease demand among certain buyers and forge closer family ties.
The launch, which received huge interest, caused a slowdown at HDB's website yesterday morning.
Buyers accessing the new projects were told the site was too busy or had only intermittent access. There were also reports of huge crowds at the HDB Hub in Toa Payoh who had turned up to get more information or submit applications.
Commenting on the latest moves, home buyer L.W. Koh, 28, said that even though he now qualifies to buy a two-room flat, the option is not for him as such homes 'are too small'.
But the civil servant welcomes the move to ban buyers who are not serious about their purchases as 'this deprives buyers like me who have not had a chance to select a flat'.
[email protected]