Good Practices and Innovations in Public Governance 2003-2011

2008 Category 1: Singapore
• Affordable Pricing: To ensure that the large majority of Singaporeans have
access to quality housing, HDB is guided by the government’s commitment
that 90% of Singaporean households will be able to own at least a basic flat.
HDB closely monitors the Debt-Service Ratio of the target segments, comparing
the monthly mortgage payments of the flats they buy with their income
levels. Today, the Debt-Service Ratios of its flat buyers are generally below
25% of their monthly household income, well within international benchmarks
on affordable housing expenditures.
To keep public housing affordable, development cost is carefully managed
through land use optimization, cost-effective building design (high-rise, highdensity)
and enhanced construction efficiency. Latest innovations in building
technology, such as prefabrication and pre-casting, are adopted to raise construction
productivity and quality, while lowering construction cost. The concept
of a sole agency in charge of public housing enables more effective resource
planning and allocation. HDB is able to secure land, raw materials and
manpower for large-scale construction to optimize results and achieve economies
of scale;
• Home Financing: Besides the availability of CPF savings for flat purchase,
HDB also provides housing loans at concessionary interest rates to eligible
home buyers. HDB flats can also be mortgaged to approved banks and financial
institutions for competitive home loans;
• Eligibility conditions: As public housing is heavily subsidized, appropriate
eligibility rules and policies are necessary to allocate limited housing resources
and subsidies to deserving applicants. Since home ownership was implemented
in 1964, HDB flat buyers need to meet the eligibility conditions of family
nucleus, citizenship, household income ceiling and non-ownership of private
property. To deter speculation of public housing, HDB flats are sold for owneroccupation.
Each eligible household can own only one HDB flat at any one
time. Flat owners need to occupy their flats to satisfy a minimum occupation
period before they can sell them in the open market or sublet their entire flats.
Each family can buy subsidized flats twice. Those who buy a second new flat
from HDB must have occupied their first flat for five years and pay a levy to
reduce the subsidy of the second flat;
• Planning Concept and Ethnic Integration Policy: Being a multi-ethnic and
religious society, Singapore recognizes the importance of racial and religious
harmony. HDB public housing estates are physically designed to promote interaction
among residents of different income levels, races and religions. HDB
estates are developed with facilities such as places of worship, eating and marketing
facilities that cater to the needs of all ethnic groups. Flats of varying
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