The restrictions on Plus flats are similar to PLH flats: 10-year MOP, clawback of subsidies and restrictions on selling.
There is no strict criteria on what qualifies as a Plus flat. The Government has briefly mentioned proximity to transport infrastructure and amenities. They had highlighted Mount Pleasant and Bedok South. Other possible locations in Huttons’ view could be the old Turf Club in Bukit Timah and Tanjong Rhu.
The Plus flats allow the Government to capture the nuances of location which tend to drive demand for a flat. By offering more subsidies, they can keep the flats affordable and inclusive. With the restrictions in place, it will reduce the lottery effect and ensure fairness.
The clawback of additional subsidies from the resale price is similar to Prime flats. The lower clawback recognises the fact that there is lesser subsidies and the location is not as prime as Prime flats.
There is also a cap on the income of buyers buying a resale Plus flats. By doing so, it may create an artificial cap on prices of resale Plus flats. This will keep Plus flats prices affordable for future buyers. However, it also means your future price gains is dependent on the Government revising the income ceiling. It may not significantly affect the first owner of a Plus flat but the second owner may not be able to realise potential gains if the income ceiling is not raised.
The longer MOP period is expected. With that in place, families will have build bonds with their neighbours and sent their children to nearby schools. It will be more difficult to uproot and move hence it increases the stickiness to remain.
HDB will also not allow Plus flats to be rented out whole at any point. This discourages owners who buy with the view of renting as flats in Plus locations may fetch higher rents than standard flats. The investment element is also nipped at the bud. It also goes back to the fundamentals of a HDB flat which is meant for stay and not for investment gains.