Picture by ZR Lin[4]
HDB’s minimum occupation period (“MOP”) policy mainly prevents HDB owners from profiting by quickly flipping their flats. HDB requires an MOP of 5 years before owners can sell their HDB flats and purchase private residential properties. An MOP of 10 years will apply for flats under the Prime Location Public Housing model[1] (e.g., city centre locations).
A common question which plagues HDB owners who are keen to purchase additional, and often, private property is whether they could circumvent HDB’s MOP by buying property on trust for their children.
The answer is an unambiguous, “No!”.
In a recent Straits Times article[2] published on 3 December 2023, a couple who had lived for 3 years in their HDB flat and wanted to buy a private condominium sought to circumvent the MOP rule by purchasing the private property on trust for their young child. They alleged that they were misled by their real estate agent, and allegedly became convinced that that their plan would not flout HDB regulations since the beneficial owners were not the couple but their child. They were later notified by HDB of their offence and were fined S$45,000.
To be sure, HDB’s website (link: HDB | Acquiring Private Property) expressly states that: “During the MOP of the flat, the flat owner, his/her spouse and occupiers are not allowed to acquire private residential property. Acquiring private residential property to hold on trust for another person is also not allowed.”
Owners of HDB flats should always familiarise themselves with the HDB rules and regulations or seek relevant professional advice before acting in haste. For greater certainty, HDB owners can check for their MOP status online using HDB’s website[3].
In the above scenario, it is useful to note that:
You can also contact Ascentsia Law Corporation should you have any enquires on conveyancing matters. Please feel free to contact our team below:
Ascentsia Law Corporation
Kenny Khoo – Director | T: 6327 5779 | E: kennykhoo@ascentsialawcorp.com
Eugene P’ng – Associate | T: 6327 5767 | E: eugenepng@ascentsialawcorp.com
[1] https://www.hdb.gov.sg/residential/buying-a-flat/finding-a-flat/plh