During the Parliamentary sitting on 11 Nov, National Development Minister Khaw Boon Wan revealed that 335,000 households still have an outstanding HDB loan. 5% or 16,300 of these households are in arrears of three months or more.
Among those in arrears, 0.7% (or 111) are affected by the CPF Valuation Limit.
Mr Khaw said that these flat owners can continue to use their CPF Ordinary Account savings to repay their housing loan after setting aside the required amount in their CPF accounts to ensure that they have at least some level of cash savings for retirement.
“If they are unable to do so, depending on the merits of each case, CPF Board may exercise flexibility to allow them to continue using their CPF savings to service their housing loans,” he said.
He was responding to a question asked about the number of HDB flat owners who are currently in mortgage arrears because of CPF limits on mortgage repayments.
Mr Khaw added, “There may be many reasons why flat owners fall into arrears. They could have over-stretched their finances, or suffered a reduction in income due to loss of job or illness.”
“HDB proactively helps flat owners manage their arrears early. If their financial difficulty is temporary, HDB will consider reducing or deferring their instalments, or work out an instalment plan to resolve their arrears. For flat owners who can no longer afford to keep their flats, HDB will explore more sustainable solutions, such as helping them right-size to a smaller flat,” he said.
Mr Khaw chose to skip answering the question on the number of HDB flat owners in the past 3 years, who have been served eviction orders despite having CPF savings in their Special Account or the CPF Minimum Sum.
In answering another question on foreign ownership of private properties in Singapore, Mr Khaw revealed that the proportion of purchase by foreigners has fallen from 17% in 2011 to 7% in the third quarter of 2013. Over the same period, the number of purchases by foreigners has fallen from about 1,400 per quarter to 330 in the third quarter of 2013.
Sub-sales as a proportion of all private housing transactions has dropped from 7.6% in 2011 to 4.6% in the third quarter of 2013. In absolute numbers, sub-sale transactions have fallen from about 670 per quarter in 2011 to 181 in the third quarter of 2013.
Mr Khaw said, “Our priority is to support home ownership for Singaporeans. This is reflected in our policies. Only citizens are allowed to buy new HDB flats and provided grants to purchase resale HDB flats. Almost all landed housing can only be purchased by Singaporeans.”
“The private condominium market allows foreigner buying and the cooling measures have moderated their impact. The resultant trend is encouraging but we continue to closely monitor the market and will not hesitate to act further when necessary.”
TR Emeritus
*Article first appeared www.TREmeritus.com