HDB flat sellers can now ask to extend stay in sold unit

SINGAPORE — In a move to smoothen the resale transaction for both parties, HDB flat sellers will now be allowed to negotiate with buyers to temporarily extend their stay in their sold unit by up to three months, the Housing and Development Board (HDB) announced today (July 22).

This will help flat owners who need more time to move to their new home, such as those who may need more time for renovation work or those awaiting funds from the sale of their current flats. The HDB estimated that about 2,700 households or some 15 per cent of all resale transactions stand to benefit from the policy tweak.

Prior to this change, flat owners who sold their flats were required to move out as soon as they complete the resale transaction as buyers are required under the lease to immediately occupy their homes.

“But this may put some sellers in a difficult situation,” noted National Development Minister Khaw Boon Wan in a blog post. “Some do not have their next homes to move into, as they may not yet be ready, e.g. renovation is in progress. Others may first need the funds from the sale of their current flat, before they can complete the purchase of their next home.”

“As a result, they often need to frantically look for some short interim rental arrangement, resulting in some disruption to their daily life,” he said, adding that this is a “problem which has cropped up occasionally during MPS (Meet-the-People session)”.

On the amount of time given, Mr Khaw said: “We settled on a three-month period as we think it should be sufficient time for the flat sellers to complete the purchase of their next home.”

Flat sellers wishing to extend their stay temporarily must have committed to buy a completed housing unit in Singapore at the time of the resale application, said the HDB. This means they must have exercised an Option to Purchase or signed a Sale and Purchase Agreement.

The request for the extension of stay is to be submitted to the HDB at the time of the resale application.

The extension of stay will automatically cease at the end of three months.

When sellers terminate the extension before three months is up, they would have to inform the HDB as this would impact on the flat buyers’ Minimum Occupancy Period.

Any such arrangements are, however, subject to the agreement of buyers, said the HDB. Details of the extension, including the duration and monetary compensation, if any, must be mutually agreed to by both parties.