Factors in Pricing HDB Flats of Different Sizes
Ministry of National DevelopmentSpeakers
Summary
This question concerns the pricing and size differences between 2-room Flexi and 3-room HDB flats as raised by Mr Muhamad Faisal Bin Abdul Manap. Minister Desmond Lee explained that HDB prices units by applying significant subsidies to market values based on comparable resale flats and specific unit attributes. The price gap is primarily driven by floor area, as 3-room flats are 20 to 30 square metres larger, and adjustments made for various lease lengths. Financial support is further provided through the Enhanced CPF Housing Grant of up to $80,000 to ensure affordability for first-timer buyers across various income levels. All flats are designed to be fully functional and comply with Universal Design requirements to meet the diverse housing needs and budgets of Singaporeans.
Transcript
138 Mr Muhamad Faisal Bin Abdul Manap asked the Minister for National Development (a) how does HDB derive the price of a new flat unit for (i) 2-room Flexi flat and (ii) 3-room flat; (b) why is there such a wide difference in the pricing; (c) what is the standard difference in flat sizes for the two flat types; and (d) what are the factors taken into consideration when determining the size of the two flat types.
Mr Desmond Lee: In pricing new flats, HDB first establishes the market value of the flat by considering the prices of comparable resale flats nearby, as well as the individual attributes of the flat, such as its location, floor area, storey height and orientation, as well as accessibility to key transport nodes and amenities. A significant subsidy is then applied to the market value so that new flats are priced below market to ensure affordability. Eligible first-timer flat buyers can also enjoy the Enhanced CPF Housing Grant (EHG) of up to $80,000, which provides further support to lower- and middle-income families buying their first home.
The typical HDB flat sizes are 36 square metres (sqm) for 2-room Flexi Type 1 flats, 46sqm for 2-room Flexi Type 2 flats and 66 sqm for 3-room flats. Three-room flats are thus 1.4 to 1.8 times larger than 2-room Flexi flats, with difference in sizes ranging from 20 to 30 sqm.
The price differences between 2-room Flexi flats and 3-room flats arise mainly due to the differences in their respective floor areas. At the individual flat level, differences in flat attributes also impact the price. In addition, 2-room Flexi flats can be offered on short leases of between 15 and 45 years, where prices will be adjusted downwards to account for the lease length and conditions.
HDB offers various flat types, ranging from 2-room Flexi to 3-Gen flats to meet the different needs and budgets of home buyers. All flats, including 2-room Flexi and 3-room flats, are designed to be fully functional, for instance, meeting the needs for basic furniture placement and comply with Universal Design requirements.