Debated in Parliament on 6 Feb 2024.
Mr Murali Pillai asked the Minister for National Development (a) in the past five years, on how many occasions did HDB exercise its discretion under section 58(9) of the Housing Development Act to provide approval for a trust to be created over a HDB flat; and (b) whether HDB will consider allowing the creation of a trust interest which favours parents who provide monies to their children to buy a flat in return for being able to live together, to protect these parents when relations break down.
Under section 58(9) of the Housing and Development Act, no trust may be created over a Housing and Development Board (HDB) flat without HDB’s prior written approval. This is to prevent parties from making use of trusts to circumvent HDB’s rules.
On a case-by-case basis, HDB may allow the creation of a trust over a HDB flat, such as in favour of a minor child beneficiary following the demise or divorce of the parents, or if the flat owners are mentally incapacitated. Where a trust is created for a minor child beneficiary, the flat must be transferred to the child once he/she reaches the eligibility age of 21 years old to own the flat. This is in pursuant to the Civil Law Act that a person must be of full age (that is, aged 21 and above) to have the capacity to enter into a contract for the sale, purchase, mortgage, assignment or settlement of any land, among others.
Over the past five years, HDB has approved 99 requests for the creation of a trust over a HDB flat.
Parents who plan to provide monies for their children to buy a HDB flat in return for living together, have the option to co-own the flat with their children, if they meet the prevailing eligibility conditions. This is a more direct way of protecting the parents’ interests in situations such as the breakdown of parent-child relations, so there is no need for parents to set up trusts for this purpose.
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