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No wedding, no flat, but DBSS buyer has to pay $120,000 penalty

A 29-year-old marketing manager, whose wedding was called off and could not buy the DBSS unit as a result, was hit with a 20-per-cent penalty for not taking up the unit. -AsiaOne

Sat, Jul 09, 2011
AsiaOne

SINGAPORE - A buyer who purchased a flat under the Housing and Development Board's (HDB) Design, Build and Sell Scheme (DBSS) with her fiancé two years ago, now has to pay a painful penalty after calling off their wedding.

The penalty amounts to a hefty 20 per cent - or over $120,000 - of the purchase price of $610,000. This is four times the five-per-cent penalty payable for the Build-To-Order (BTO) flats.

The Straits Times reported that Ms W L Teoh, 29, signed for the five-room flat in Ang Mo Kio with her fiancé two years ago, but the wedding was called off soon after.

With the wedding called off, they were made ineligible for the flat that they had signed up for. HDB's Fiancé/Fiancée scheme states that an engaged couple must produce a wedding certificate three months after taking possession of a flat.

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Ms Teoh told The Straits Times: 'When we decided not to go ahead with the marriage due to personal reasons, we were hit with an absurd penalty amount.'

She was offered by HDB to purchase the flat under a different scheme, with eligible family members.

However, her parents were ineligible, leaving her with little choice but to pay the penalty, which amounted to more than $140,000 after the inclusion of interest, stamp duty and legal fees they had already paid for.

In the case of a private property owner who decides to reject a unit that he has signed up for, he is allowed to resell his unit to another buyer, unlike that of a DBSS buyer who will have to adhere to HDB's five-year rule.

HDB is appealing to the developer on Ms Teoh's behalf to explore possible options. The Straits Times reported that there will be a meeting to discuss this next week.

After public outcry about the pricing of Centrale 8, the latest DBSS project in Tampines, the Ministry of National Development halted the sale of DBSS plots and put the scheme under review.

Yesterday, a DBSS land sales tender at Sengkang that was originally scheduled for closure on July 20 was withdrawn.

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