Government grants smaller flats instead of reducing lease tenure

Instead of reducing the 99-year lease tenure to make HDB flats more affordable, the government prefers other methods to assist those with lower income to acquire their own flats, said Mr. Mah Bow Tan, Minister for National Development.

According to Mr. Mah, HDB now offers additional grants to the low-income group and constructs smaller units at an affordable price. The government will also ensure that applicants with higher income will not compete with them for a similar flat – this is why HDB provides an income ceiling for two- and three-room flat applicants. “With all these in place, we do not see any problem in making HDB flats affordable for first time lower-income families,” he said.

On the issue of having a shorter lease tenure of 60 years for young couples, he added: “We are going to run into trouble especially when that particular family grows old.”

When asked by MP Cedric Foo if Singaporeans are not purchasing flats located in poorer locations as they are not priced correctly, Mr. Mah answered: “We do price these less attractive flats cheaper than the other flats. Is it cheap enough? I don't know how cheap is cheap enough.”

“But I think the evidence says that people who reject these flats, some of them don't even look at the price when they do reject them. So, it's not just a matter of pricing,” he added.