Oral answer by Ministry of National Development on open market rents for HDB 3-room, 4-room and 5-room flats and the Parenthood Provisional Housing Scheme rental vouchers

Apr 2, 2024


5883. Ms Joan Pereira: To ask the Minister for National Development whether the Ministry will consider offering Parenthood Provisional Housing Scheme rental vouchers of more than $300 a month for couples who are from families with lower household incomes and who stay in smaller flats.

5908. Mr Chua Kheng Wee Louis: To ask the Minister for National Development (a) in the last three years, what is the average increase in open market rents for HDB 3-room, 4-room and 5-room flats; (b) whether the Government will consider raising the monthly household income ceiling of $7,000 for families using the Parenthood Provisional Housing Scheme (Open Market) Voucher to rent HDB flats from the open market; and (c) if not, how will the Government assist more young couples to afford interim rental properties in the open market.

Answer:

  1. Open market rents had stayed broadly stable prior to the COVID-19 pandemic but have increased in the past three years due to unprecedented supply-side constraints and increased rental demand arising from COVID-19.
  2. In 2021, the average year-on-year increase in open market rents for HDB 3-room, 4-room, and 5-room flats was 5%. This increased to 35% in 2022, amidst the easing of border restrictions and recovery of non-resident rental demand. We have since implemented a suite of measures to support households who need to rent accommodations. These include increasing both private and public housing supply, temporarily relaxing the occupancy cap for larger HDB flats and private residential properties, as well as ramping up our supply of rental flats under the Parenthood Provisional Housing Scheme, or PPHS.
  3. Public and private housing rents have shown signs of stabilising. The average year-on-year increase in open market rents for HDB 3-room, 4-room, and 5-room flats was 10% in 2023.
  4. The PPHS provides a temporary housing option for families with less income at their disposal to rent a flat while waiting for their HDB flats to be completed. HDB is working to double the supply of PPHS flats from about 2,000 units currently to about 4,000 units by 2025.
  5. Meanwhile, we will introduce the PPHS (Open Market) Voucher Scheme as a temporary measure to support eligible families who rent HDB flats or bedrooms in the open market. The scheme will run for a one-year period from July 2024, and eligible families will receive $300 per month. Families must be eligible for PPHS and have a rental tenancy registered with HDB.
  6. The PPHS Voucher parameters have been carefully calibrated to provide some relief for eligible families, while mitigating the potential inflationary impact on the rental market. The $7,000 income ceiling targets our support at families with less income at their disposal to rent on the open market. Given the voucher quantum of $300 per month, eligible families will receive up to $3,600 if they qualify for the full year of support. Families will have the flexibility to select a rental option – whether a whole flat or an HDB bedroom – that suits their budget and needs.
  7. There are currently no plans to raise the income ceiling of $7,000 for the PPHS Voucher, or to offer a higher voucher quantum. Households with incomes above $7,000 but have additional expenses due to exceptional circumstances, such as high medical expenses, may approach HDB for help. HDB will consider their applications on a case-by-case basis.
  8. Families will also continue to have the option to apply for a PPHS flat offered by HDB. Married couples with children will continue to be given priority for PPHS flats. In recent exercises, all married applicants with children, including those expecting children, had a chance to select a PPHS flat.