Price Gap between Private Housing and HDB Resale and BTO Flats

Mr Gan Thiam Poh asked the Minister for National Development whether the price gap between (i) private housing and HDB resale flats and (ii) private housing and HDB BTO flats has narrowed respectively since the Total Debt Servicing Ratio framework was implemented.

The Total Debt Servicing Ratio (TDSR) framework was introduced in June 2013 to safeguard financial prudence and prevent individuals from over-leveraging when they purchase private housing with housing loans from financial institutions (FIs). For those purchasing a Housing and Development Board (HDB) flat, they are likewise subject to a Mortgage Servicing Ratio limit if they take an FI-originated or HDB housing loan. These measures have helped to moderate prices in both the private and public housing markets.

The majority of HDB Build-To-Order (BTO) flats built in the past few years were in non-mature estates, which are located in the outside central region. For this region, the median price gap between private housing and HDB BTO flats was 169% prior to June 2013 and is now 166%. Between private housing and HDB resale flats, the median price gap was 106% and is now 130%. However, as there are many different factors which could affect the prices of private and public housing, price comparisons between the two markets should be interpreted with care.

The Government will continue to monitor the overall property market closely to ensure that it remains stable and sustainable.