The Housing & Development Board (HDB) will be relying on buyers of non-subsidised flats to declare if they own private properties here or overseas.
Those found making false declarations will face penalties, which include a fine of up to $5,000, or imprisonment for up to six months, or both.
HDB shared these details yesterday, in response to questions on how it will enforce new rules introduced this week to cool the residential property market. Key among these are rules preventing people from owning both public and private properties.
From 30 August, a person who buys a non-subsidised flat can buy a private property here or overseas only after fulfilling a minimum occupation period (MOP) of five years.
Also, a private property owner who buys a non-subsidised HDB flat will have to sell his private property within six months of the flat purchase - regardless of whether the property is here or abroad.
HDB said yesterday that buyers of non-subsidised flats will have to declare their interest in any other property in Singapore or overseas in the application form.
If the private property is abroad, buyers have to produce documentary evidence showing that they sold the property within the stipulated period.
Those found guilty of making false declarations will be fined up to $5,000, or imprisoned for up to six months, or both. If HDB discovers the lie before the flat purchase is completed, it can cancel the application.
The seller can seek legal redress from the buyer for breach of contract arising from the failed transaction.
HDB can compulsorily acquire the flat if it discovers the false declaration after the buyer has taken possession of the flat.
Rules aside, HDB added that it is 'prepared to exercise flexibility on a case-by-case basis depending on the merits of each case'.
According to HDB, the new rules introduce parity to the treatment of all HDB flat buyers, by subjecting buyers of non-subsidised flats to the same rules for buyers of subsidised flats. The latter are not allowed to concurrently own a flat and a private property either here or overseas within the MOP.
Most market watchers felt that owners of private property in Singapore would declare their interest when buying non-subsidised flats.
There are many systems for tracing the ownership of homes locally, said C&H Realty managing director Albert Lu.
The challenge lies in verifying foreign property ownership. It is either impossible or impractical to do so, said PropNex chief executive Mohamed Ismail.
Permanent residents who own properties overseas for their parents to live in or who inherit farming land are in a bind, he added.
ERA Asia Pacific associate director Eugene Lim believes that there will be people who choose to take the risk and make false declarations.
Source: iProperty
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