SINGAPORE - At the National Day Rally on Sunday, Prime Minister Lee Hsien Loong unveiled an overhaul of the current estate classification system that will take effect from the second half of 2024.

Instead of demarcating estates as mature and non-mature, new Build-To-Order (BTO) flats will be split into three categories under a new framework with tiered buying-and-selling restrictions.

This is what you need to know.

1. New classification of flats

From the second half of 2024, new BTO flats launched by the Housing Board will be categorised into Prime, Plus and Standard flats.

Towns will no longer be demarcated as mature and non-mature, in a departure from a longstanding classification system introduced in 1992 that buyers use to form a top-line impression of what to expect in terms of pricing and an area’s amenities.

The new classification of flats is to better reflect the locational attributes of each BTO project, rather than relying on the physical traits of the estate it sits in.

PM Lee on Sunday said the distinction between mature and non-mature estates has blurred over the years, as non-mature estates have become more built-up with better amenities and transport infrastructure.

Moving forward, more public housing will be built within or near existing estates and in more central areas, as there are fewer large tracts of undeveloped land available for future BTO projects today compared with years ago.

As new flats in choice locations tend to be more popular and would be priced higher, a new classification system with tighter conditions is needed to ensure homes remain affordable and accessible – both at the initial purchase from HDB and on the resale market.

2. Tighter restrictions for more BTO flats 

Prime flats, which are currently offered under the Prime Location Public Housing (PLH) model, will come with the tightest restrictions, as HDB applies the most subsidies to keep these flats affordable.

These include a 10-year minimum occupation period (MOP), a subsidy clawback clause if the buyer sells the flat on the resale market, and not being able to rent out the entire unit at any point in time, even after the MOP.

After these Prime flats hit the resale market, owners can sell them only to people who meet the prevailing BTO eligibility, such as households that earn no more than $14,000 a month.

The next tier down is a new category – Plus – which will be for flats in locations less central than Prime flats but more attractive than Standard flats, such as near MRT stations and town centres, within each region across Singapore.

Plus flats will be priced with more subsidies than those for Standard flats, though the subsidy amount is less than that for Prime flats. Plus flats will thus also have tighter conditions, such as a 10-year MOP and clawback of additional subsidy.

However, the restrictions on the pool of resale buyers for Plus flats will be less strict compared with those for Prime flats. HDB and the Ministry of National Development (MND) said more details will be announced soon.

The third category is Standard flats, which will continue to form the bulk of the housing supply. These flats will come with the standard five-year MOP and have no restrictions on the pool of resale buyers.

3. Existing flat owners not affected

The new classification of flats will apply only to new BTO flats launched from the second half of 2024, not to existing flat owners or to those who have already booked their flats.

It will take more than 10 years before Plus flats are available on the resale market, given the longer 10-year MOP, noted HDB and MND.

The authorities said they will continue to monitor the impact of the measures on the broader resale market and review them where necessary.

4. More flat options for singles

From the second half of 2024, singles will be able to buy two-room flexi BTO flats across Singapore directly from HDB, regardless of whether the flats are categorised as Prime, Plus or Standard.

Currently, singles are able to buy only two-room flexi BTO flats in non-mature estates.

The minimum age for singles to buy BTO flats remains unchanged at 35, and the income ceiling of $7,000 – half of the $14,000 for families – will continue to apply so that housing subsidies are given to those who need them most, said HDB.

On the resale market, singles will be able to purchase two-room Prime flats if they earn less than $7,000 a month as per the BTO eligibility conditions. They are currently not allowed to buy such flats.

Singles can continue to purchase any Standard or Plus flats, except the three-generation flat type, on the resale market.

5. Senior-friendly upgrades

Seniors can look forward to more elderly-friendly fittings in their homes, under an expansion of the Enhancement for Active Seniors (Ease) programme.

These fittings include foldable shower seats and widened toilet doors for easy wheelchair access.

Barrier-free access ramps, raised zebra crossings, rest points along sheltered linkways, and larger and more colourful block signs with familiar symbols to help seniors identify their own block will be installed in HDB precincts to enable safer and more comfortable commutes.

More therapeutic gardens, fitness trails and exercise machines will be added to encourage seniors to stay active, said HDB and MND.

These improvements will be made in precincts all over Singapore, starting with older precincts with more seniors such as Ang Mo Kio and Bukit Merah, said PM Lee.

More Community Care Apartments, which are assisted living flats with customisable care services for seniors aged 65 and above, will be launched. These flats are aimed at helping seniors age in place independently.

So far, flats in two sites in Bukit Batok and Queenstown have been launched. A third site in Bedok is expected to go on sale in December 2023.

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Watch PM Lee’s National Day Rally speech here: