SINGAPORE – In July, HDB revealed that about 70 flats were reacquired following serious lease infringements over the last few years.
These infringements, which include unauthorised rentals and flat owners failing to occupy their flats during the minimum occupation period (MOP) or acquiring interest in private property, were among some 800 cases that HDB took action against between 2019 and 2023.
The Straits Times speaks to HDB to understand how and when the authorities decide to reacquire flats.
1. Under what circumstances does HDB reacquire flats?
It considers the full circumstances of each case to determine the appropriate enforcement action to be taken against errant flat owners.
The board said that it may reacquire flats if owners commit any infringements named under Section 63(1) of the Housing and Development Act, especially in more egregious cases where owners illegally rent out entire flats and do not need the flat for accommodation.
Such infringements include but are not limited to:
- Unauthorised rental of HDB flats and bedrooms;
- Non-occupation of flats during the MOP;
- Acquisition of interest in private property within the MOP;
- Failure to make payments due to the board for three calendar months despite being notified by the board;
- The owner ceasing to be a Singapore citizen or permanent resident;
- Failure to meet lease conditions despite being notified by the board to do so; and
- Permitting unauthorised persons to live in the flat.
2. Can flat owners appeal?
Flat owners who object to their flats’ reacquisition or the compensation amount may write to HDB within 28 days after receiving a notice, before the board reviews the case and responds.
If, subsequently, a flat owner still objects to the decision to compulsorily reacquire the flat, he may write to the Minister for National Development within 28 days after receiving HDB’s decision, the board said.
The minister’s decision will be final, it added.
3. Are HDB owners compensated when their flats are reacquired?
Compensation is determined based on factors such as the severity of the infringement and the circumstances of the case, as well as the administrative and holding costs in reacquiring the flat.
The board stated that its compensation policy ensures that flat owners who commit lease infringements do not enjoy any “undue financial gains from the compensation that they receive”.
4. Are there other penalties for owners of reacquired flats?
Under the Housing and Development Act, owners whose flats are reacquired will be barred from buying a subsidised flat (such as a direct purchase or a resale flat purchased with a CPF Housing Grant), taking over such a flat by way of a change in ownership, or renting a flat from HDB for five years.
Additionally, these errant owners cannot be listed as occupiers in the application for such flats, and any application in the HDB queue for a subsidised flat made prior to their debarment will also be cancelled.
5. What happens to reacquired flats?
They are put up for sale under its Sale of Balance Flats exercise.
These units are priced by taking into account factors such as the prices of comparable resale flats nearby, the flat’s location, the storey it is on, accessibility to amenities and facilities, the remaining lease period, and market conditions at the point of sale.
As with other flats sold by HDB, a market discount is applied to ensure such flats are affordable.
“Source:[askST: How are HDB flats reacquired? Can owners appeal? What happens afterwards?] © Singapore Press Holdings Limited. Permission required for reproduction”
