My Resale Flat Journey: First Property is 30-Year Old Resale Flat

The post ‘My Resale Journey: First Property is a 30-Year Old Resale Flat’ appeared first on the MoneySmart blog

Mr Wong, 32, and his wife, Madam Lai, 31, are on the cusp of moving into a resale flat in Jurong West with their child, as well as Madam Lai’s brother and sister-in-law.

The couple’s 5-room flat has just been renovated, and they are now putting the finishing touches to their new home.

In this second part of a 3-part series in which we present the stories of resale flat buyers, we spoke with Mr Wong on his new home and the process he went through to purchase his resale flat.

About The Flat

Owner: Mr Wong Bin Hao, 32, married with 1 kid

When we visited Mr Wong’s flat at Jurong West Avenue 5, workmen were finishing up their final renovations.

But the flat already looked cosy and inviting, with a comfy couch and a pile of Hello Kitty cushions beckoning us as we entered.

MoneySmart (MS): Mr Wong, how did you and your wife decide to buy a flat in Jurong West?

My wife and I both work in the Jurong area. For a period of time, we rented in nearby neighbourhoods and moved around.

I have been living in Jurong West for about three to four years. I’ve always found this area quite lively and naturally, wanted to buy a home here.

MS: Besides the fact that it’s lively, what else about this place appealed to you?

My two-year-old kid goes to the childcare centre in this block. You can also see the playground from here so it’s perfect and convenient for us. There are some primary schools close by that my child can attend in the future.

There are also two malls nearby, Pioneer Mall and Gek Poh. When the future Jurong Region Line is up, we will be within walking distance to an MRT station, so I think it was worth the buy.

MS: You started out renting a flat. What made you decide to take the plunge and buy your own place?

For me, having that sense of ownership is important.

When you rent, you might need to move from time to time, like what happened to us in the past. I found it tiring to be moving from house to house every year or so.

Some landlords are also not prepared to accept tenants who keep different hours or lifestyles. At the start they may say everything is okay, then suddenly they become fussy and impose curfews on the tenants.

There are uncertainties when you rent a place with friends too – they may need to move elsewhere and you will need to find another flat mate.

When I rented a place, I had to pay the landlord rent in cash every month, and could not make use of my CPF savings. Now, I can pay my housing loan instalments using CPF, so I don’t really need to fork out cash. For all these reasons, I feel it is good to have my own flat.

MoneySmart Tip: You can use this service to work out an estimated financial plan for the purchase of a resale flat if you are taking an HDB loan.

MS: We understand that your flat is about 30 years old. Was its age a concern for you?

One reason why I bought a resale flat is that it is more spacious for my family. This flat is about 120 sqm and the kids have more space to run around. Sometimes my parents or my wife’s parents will visit. So it’s better to have more space.

We still have 69 years left on the lease which is good enough for us. Our children and future generations are likely to buy their own homes anyway, so we don’t need to worry about leaving this flat for them. As we are planning to use this flat as a home, I think it’s good enough. For the next generation, you don’t need to bother as the kids will buy their own homes.

Although this is an old estate, the area is well taken care of by the Town Council and HDB also carries out upgrading of the flats.

MoneySmart Tip: Use this online map service to get lease information, resale prices, and even season parking information for each housing block. You can filter through nearby amenities to see where to dine and shop.

MS: Do you see your flat as an investment?

When we were weighing the pros and cons of buying a 30-year-old flat compared to a newer one, we did think about this issue. However, we feel that a house is for the long-term and one that would see us through our old age. Instead of hoping to make a profit from moving houses, we would rather stay in one flat and finish paying our housing loan sooner, so that we can free up our finances for other things.

MS: How was the purchase process? Did you go through an agent or DIY?

We initially tried to DIY by using a property website, but later on we received calls from estate agents offering their services and we engaged an agent eventually. He asked us what sort of attributes we wanted in a flat, and helped us to look for suitable flats that were within our budget.

Everyone has different interests and needs, so it’s important to know what your own needs are, before you decide whether to engage an estate agent for your resale transaction.

MoneySmart Tip: We asked Mr Wong if he knows about HDB’s Resale Portal, and he says he doesn’t. The HDB Resale Portal could have guided him in the buying journey. It takes buyers and sellers through the buying and selling process in a step-by-step manner online and allows them to DIY their transaction if they choose not to engage an estate agent.

MS: How is your flat being financed?

We went for an HDB loan as we found it less complicated than going for a bank loan. For bank loans, the interest rate is a bit uncertain.

Although the HDB loan interest rate is currently higher than for bank loans, the difference is not that much after you do the math.

Initially we indicated that we wanted to settle the loan in 10 years. Then HDB called us to ask whether we wanted to reconsider. Based on our salary, they recommended an 18-year loan tenure so that we can buffer for things like employment changes or if we suddenly need cash for urgent reasons. They explained that we can make partial capital repayment or even redeem the loan earlier if our finances permit. We found the advice useful. My wife and I are planning to settle the loan earlier to incur less interest and save more for retirement.

MoneySmart Tip: Find out how you can make partial capital repayment or fully redeem your HDB loan and save on housing loan interest.

MS: Did you get to enjoy any grant?

We got the housing grant for first-time buyers, which was a really attractive sum. We initially set aside a bigger budget as we thought we would not be eligible for grants. So for us, getting the grant was a bonus.

MoneySmart Tip: Find out what grants you qualify for, so you can plan your finances for your new HDB home.

MS: How has the renovation process been like?

We spent about $35,000 on renovations, mainly for works in the kitchen and for furnishings around the house. This includes $16,000 paid to our contractor, who was flexible to work with.

We did not hire interior design firms as we found their prices quite high. Since we wanted to save money, we thought it was better to work directly with contractors. For example, the rewiring cost quoted by the contractor was cheaper than market rate!

MS: Any advice for aspiring homebuyers?

You don’t really need to look for flats with fanciful fittings, because you will probably have to do your own renovations anyway. For example, even if the flat comes with nice flooring, the colour of the tiles may be uneven after the previous flat owner has removed all their furniture. So you might still need to replace the floor tiles.

MoneySmartTip: Planning your renovations for your HDB flat? Know what’s important to note and familiarise yourself with the guidelines.

Source: mynicehome.gov.sg

My Resale Flat Journey: A Change of Scenery After More Than 20 Years

The post ‘My Resale Journey: A Change of Scenery After More Than 20 Years’ appeared first on the MoneySmart blog

After living in the West for more than two decades, Mr Bactarudin bin Launon and his wife decided it was time to move.

The couple, who previously lived in a 4-room flat in Jurong West, moved to a 3-room resale flat in Marsiling in January this year. This was in part motivated by the desire to stay closer to their daughter, and also better prepare for retirement by paying off their home loan.

For this final installment of our 3-part series profiling HDB resale flat buyers, we had a chat with Mr Bactarudin about his new home, his experiences as a resale flat buyer and his thoughts on owning a home in Singapore

About the Flat

Owner: Mr Bactarudin bin Launon, 70, married with a daughter who has moved out.

Mr Bactarudin and his wife greeted us in the living room of their newly-renovated flat at Marsiling Lane.

Mr Bactarudin, a security guard, was taking two weeks’ off work to recuperate after a fall.

While the couple appeared to have settled in well and seemed familiar with their new neighbourhood, they revealed that they had actually moved in just three months ago.

MoneySmart (MS): Thanks so much for having us here. We understand you used to live in Jurong West. Why did you decide to move to Marsiling?

Yes, we lived in Jurong West for 24 years before moving here. We sold our 4-room flat and rightsized to a 3-room flat.

MoneySmart Tip: Mr Bactarudin and his wife received a $20,000 Proximity Housing Grant, as they moved within 4 km of their daughter. Buyers who plan to take up the Proximity Housing Grant can check online whether the flat they intend to buy is within the 4km radius of their parents or children.

MS: Any reasons for not buying a smaller flat in Jurong?

Jurong is a big commercial area and I find things there becoming more expensive.

We also could not find a 3-room flat in the Jurong area for the same price as our current flat. Together with the fact that we could be closer to our daughter and grandchildren, getting this flat here in Marsiling at the price we bought it for was a natural decision.

MoneySmart Tip: To find out transacted resale prices sorted by different towns and flat types, buyers and sellers can access the median resale prices released every quarter.

MS: Having lived in the west for so long, how are you adapting to your new neighbourhood?

Based on my experience interacting with people, it’s almost the same. Depends on whether you take the initiative to greet them also, because we’re the newcomers here.

My neighbour here, who lives opposite us, talked to me first: “Uncle how are you, where you are from?” and so on. This was the first day after I moved in, and I was doing painting outside when they were leaving for work. The second day, I was once again doing painting outside and they started another conversation with me. I told them I moved here from Jurong, and then asked them more about themselves. That’s how we got to know each other.

MS: Are there any big differences between Marsiling and Jurong West?

I’m quite happy living here and find it comfortable.

Within the flat, I don’t see much difference between this and our old home. Outside the home, one main difference is having to walk further for makan.

The eating places in Jurong West were nearer to home. I could cross the road and have teh tarik. Over here in Marsiling, there is a supermarket, 7-11, and a wet/ dry market. It is further away and we will visit once in a while.

But most of the times, we cook at home so we don’t really go to these eateries that often.

MS: Did you get your current Marsiling resale flat through an agent or did you DIY the transaction?

We bought the flat through an agent who is a relative’s friend. They helped with everything. We just let them do everything. They found the price we wanted.

We viewed quite a few resale flats before making a decision. We did not move into this flat until our previous flat was sold.

MS: How did you finance the flat?

We didn’t take out a loan. The flat is fully paid for, so we do not need to pay any monthly instalments.

As I also needed money for my medical condition, selling the old flat and moving to a smaller one was a financial decision as well.

MS: What about the renovations?

We did our own renovations. I think we spent about $8,000.

His wife interjected that the renovations actually cost about $20,000.

We had to do a little bit of wiring. The bulk of the cost went into renovating the kitchen. We also spent on the flooring, sink, fittings, and buying furnishings.

MS: What are your thoughts on buying and owning a home in Singapore?

I’m from Singapore, this is my place, this is my country, this is where I was born.

Singapore is still where I would prefer to have a home to call my own. I recall some friends who bought a place outside Singapore – it may work for you if money is not an issue. But they were not familiar with the rules and the foreign environment. I have worries on what will happen to them if they don’t like it there and have to find another home if they want to return to Singapore.

Source: mynicehome.gov.sg

Mature Versus Non-Mature HDB Estates

If you are eyeing a new HDB flat, you would have thought about where your future home will be. For those still mulling it over, we break down the key differences between mature and non-mature estates.

Flat Prices

New flats are sold at subsidised prices, regardless of location. However, flat prices may vary based on factors like flat attributes, surrounding amenities and locations. In general, prices of flats in non-mature estates tend to be lower than those located in mature ones.

Regardless where you are aiming to set up your new home, you can receive the Enhanced CPF Housing Grant of up to $80,000 when you buy a flat.

Amenities

Home is so much more than just the four walls of your flat – amenities matter, too. Mature estates, as their name implies, are older as they were established much earlier than their non-mature counterparts. As such, residents enjoy various amenities that have been developed over the years. These include transport networks, shopping malls, schools, and parks.

But non-mature estates are far from under-developed! While not all amenities may be ready the minute you move in, give it some time and you’ll soon enjoy new facilities that might end up being the envy of others. Just look at Punggol or example! Singapore’s first eco-town now bustling with life, full of amenities comparable to mature estates. There are shops and communal spaces aplenty at Oasis Terraces, HDB’s first New Generation Neighbourhood Centre. Punggol Waterway, which meanders through the town, is also home to water-based recreation activities and other community activities.

Residents in newer estates also get to enjoy a living environment enhanced by the latest state-of-the-art urban solutions. Projects in Punggol are fitted with innovative eco-features such as centralised recycling refuse chutes to promote recycling; rainwater harvesting system to encourage water conservation, and LED with motion sensors.

TLDR: It Depends on Your Needs and Priorities

Of course, as with most decisions, there are pros and cons.

Flats in non-mature estates are great, budget-friendly options. While amenities in these estates might still be work-in-progress when you move in, you will soon be able to enjoy a wide range of new facilities near your home.

Mature estates have their own charm, with many established amenities around. However, competition for new flats in mature estates can be stiff, with a much smaller pool of flats available as compared to non-mature estates.

If mature estate is still your cup of tea, you can consider resale flats, too. You may be eligible for grants of up to $160,000 if you buy a resale flat.

All in all, whether a mature or non-mature estate is the best for you depends largely on your priorities. Still confused or need more advice on flat buying? Be sure to check out more of our articles!

Source: mynicehome.gov.sg

A Quick Guide to HDB’s Sales Modes

If you’re looking to purchase your first home, chances are you’ll be familiar with the Build-to-Order (BTO) and Sale of Balance (SBF) exercises. Did you know that in addition to these, you can also apply for flats through the Open Booking exercise and book a unit as early as the next working day?

Read on to find out more about HDB’s different sales modes!

Build-To-Order (BTO)

HDB launches new BTO flats for sale 4 times a year. A range of flat types in different towns are offered during each launch, providing home seekers with a range of housing options for every  budget and need. BTO projects are announced 3 months prior to their launch, to help you with your planning.

At the close of each exercise, a ballot is conducted, and results are announced approximately 3 weeks later. If you want a flat faster, look out and apply for  BTO projects that have a shorter waiting time of 2-3 years.

Sale of Balance (SBF)

SBF takes place twice a year, in May and November,  alongside the sales exercises. With SBF, you can apply for balance flats from earlier BTO sales launches, surplus flats in projects built for those affected by the Selective En bloc Redevelopment Scheme (SERS), as well as flats repurchased by HDB. As such, there is usually a variety of flat types across different towns. You can indicate your preferred flat type and town during your application.

The flats could be under construction, near completion, or already completed. Hence, this is an option if you prefer to buy flats with a shorter waiting time compared to new BTO flats. But do note that the number of such balance units offered in each town is usually limited, and likely to attract high demand.

Open Booking of Flats

Open Booking of Flats lets you apply for a flat online any time throughout the year and to book a unit as soon as the next working day.

Currently, flats that are not taken up during SBF exercises are offered through the Re-Offer of Balance (ROF) flats before they are made available for open booking. To help buyers get their homes earlier, we will do away with ROF exercises, and offer  unselected flats from SBF exercises directly for open booking. This was part of measures announced by Minister Lawrence Wong to keep housing accessible, at the Committee of Supply Debate 2020.

A Summary of HDB’s Sales Modes

Source: mynicehome.gov.sg

The Case for Buying the Most Affordable Home You Can

My co-founder bought a 3-room resale flat in a mature estate last year for a tidy $430,000 in Marine Parade (before the various CPF Housing Grants).

Personally, I think this is a pretty smart decision, given his income and lifestyle. A 3-room flat (or 4 room) flat also makes more sense compared to a 5-room flat, because:

• Less rooms to clean
• Less money spent on renovation
• Lesser need for so many rooms anyway, if you’re not intending to have kids

That said, conventional home owner wisdom is to buy the biggest or the most expensive HDB flat based on your budget. I know couples who don’t earn that much but are considering going all out for HDB flats in locations like Boon Keng, where the resale prices could be as high as $900,000.

Yikes.

Today I’d like to present another argument: why you should buy the most affordable flat you can.

Now, I’m going to qualify some stuff upfront.

What we mean specifically is to ‘buy the most affordable flat that meets your needs, not ‘buy the absolutely cheapest flat.’

There is a difference.

Avoid the ‘asset rich, cash poor’ trap that many people fall into

To many traditional Singaporeans, this is the idea of being rich: Own lots of expensive things and live in a big house. This mindset is a key ingredient for a lifetime of debt.

But consider this other definition of being rich: Having enough money and freedom for many experiences – cycling around the world, starting a business, supporting causes you’re passionate about, spending more time with your ageing parents and young children.

We think, in the 21st century, the real marker of wealth is time, mobility and options.

All three cannot be achieved if you’re bogged-down paying for an expensive flat way beyond your means.  BUT, they can be achieved if you work on your investments. Which brings us to our next point.

Buying a home beyond your means will limit your investment potential 

Okay let’s get one thing clear.

There are generally two types of residential property in this world – property you live in, and property you invest in.

• The first one is where you just live in and don’t make money from. This is your *home*. Even when you sell your home to get cash, chances are you’ll use this cash to buy another home.
• The second is one you try to make money from. This is called an investment.
• Sometimes, these two categories overlap. HDB flats, which are meant to be affordable public housing for homeownership, typically fall in  the first category (more on this later). 

Sometimes, these two categories overlap. HDB flats, which are meant to be affordable public housing for homeownership, typically fall in  the first category (more on this later). 

The more money spent on your home, the less money you have for investments (investment property, stocks, bonds, etc). Now, this sounds ridiculously simple, but many will find this hard to understand.

Simplified even further, it looks like this:

• You want to retire earlier: spend below your means on your home, spend more on investments.
• You want to retire at 62 like everyone else: spend within your means on your home, invest as per normal.
• You want to have insufficient retirement funds: spend beyond your means on a home, don’t invest.

Here’s some boring math to drive the point home (pun intended). STAY WITH ME.

Let’s assume you buy an HDB flat and stretch payments across 30 years, at an interest rate of 1.7% p.a. These are what your mortgage payments will look like.

Property price	Monthly repayment, assuming 1.7% p.a over 30 years
$400,000	$1,419
$600,000	$2,129
$800,000	$2,838

If you had picked the $400,000 flat over the $600,000 one, you would have $710 more each month for your savings or investment.

This doesn’t seem like much, but let’s look at the opportunity cost of investing the $710 over 30 years.

Place	Interest rate	Opportunity cost of having $710 invested over 30 years
Under your mattress/ In a biscuit tin (TWS does not recommend this investment vehicle)	0%	$255,600
CPF SA	4%	$486,542
Stock Market (conservative)	5%	$578,916.
Stock market  (optimistic)	7%	$830,311

Now, I want to be very clear. We’re not saying that buying a $600,000 or $800,000 flat is a financial disaster.

If your combined household income is like $20,000, go ahead. You can buy pretty much any HDB flat you want and have enough left over to work towards your financial freedom.

But if you and your spouse are the median Singaporean couple earning about the median household income of $9,425, you need to be more cautious. 

Which brings us to this.

What’s ‘too much’ to spend on a flat? 

To avoid spending too much on a flat, you must know what is too much. Here are two methods you might find useful to judge whether your flat is too ex.

The first is the 3-3-5 rule, popularised by property blogger Property Soul and often criticised for being too conservative.

Following the ‘3-3-5’ means you meet all of the following criteria:

• You should have 30% of your capital ready before you purchase your property
• Your monthly repayments should not be more than ⅓ of your monthly income
• And the property price should not exceed your annual income by 5x

Our suggestion is to use the last rule and then work backwards. It looks like this:

Your household income	The max price of a flat you should buy	Save this amount before buying	Your max monthly payments
$9,425 (median income in 2019)	$565,600	$169,650	$3,141
$14,000 (income ceiling for BTO)	$840,000	$252,000	$4,666
$16,000 (income ceiling for EC)	$960,000	$288,000	$5,333

Criticism for 3-3-5

Now, a lot of people find this rule very limiting. “iF i foLlOw ThiS I cAnNoT afFoRd anYthIng,” they say. 

My opinion is that the rule is a good rule of thumb, and perhaps their tastes in properties are too exquisite or aspirational.

That said, different strokes for different folks. We’re a page focused on savvy financial decisions, not living in luxury or impressing people. So, use your own judgement.

The second rule we’ve created is a simple one called “follow the crowd”

It follows the same logic you used in secondary school to find out whether you’re keeping up with the syllabus.

If you’re the only one failing a test, you should be worried. But if everybody failed a paper, you’d be relatively safe.

(We’ve lumped all 3, 4, and 5 room flats in the same category because it’s very possible for small families to overextend themselves to buy a 5-room flat when a 3-room would have sufficed.)

Which brings us to this magical number: The average price of all  3-, 4- and 5- room resale flats in 2020 is $430,000 (rounded down from $433,363). Typically BTO flats are cheaper, because they’re subsidised by HDB.

$430,000 isn’t a number we pulled out from nowhere, I’ve used paid software from 99.co (where I work) to generate this chart – it gets data from URA, REALIS and of course, 99.co.

At the same time, the median household income is $9,425. 

If you spent more than $430,000 on your flat, but are earning below the median income, then you should be clear that you’re spending beyond the norm.

Same if you’re earning the median income but spent significantly more than $430,000.

Like the 3-3-5 rule, this isn’t something you need to follow religiously, but more of something to build self-awareness.

You’re not doomed if you ‘overspent’. But you need to recognise that you’ve spent beyond the average amount – and then work to make up for it somewhere.

If you find all these rules restrictive, you can check out HDB’s financial planning tools to help you draw your own conclusions instead. They also have their own useful guidelines to help you make your decision.

Of course, buying a flat is not all about money 

You know what? We get it. We actually do. Money isn’t everything. Buying and owning a flat is a rite of passage, and it’s often an emotional decision. A home has feelings attached to it – feelings of belonging, love, and hope.

What’s right for you?

We are not you, so we honestly don’t know.

What can be said is this: According to the Pareto principle, 80% of life’s outcomes are caused by the 20% of inputs. To simplify, 20% of your choices in life will affect 80% of your life.

Your first flat that you buy in the prime of your youth?

It’s definitely in that 20%.

Stay woke, Salaryman.

Source: mynicehome.gov.sg

The Woke Salaryman Guide to Buying Your HDB Flat

Thinking of buying your first HDB flat soon? Before you apply for a new flat in our sales launch exercises or look for a resale flat, you should be savvy and plan your finances first. The Woke Salaryman shares 5 tips on how you should plan for your finances for an HDB flat purchase:

Source: mynicehome.gov.sg

Expenses First-Timer BTO Flat Buyers May Overlook

Planning to buy a flat at one of HDB’s sales launches, and working out the math for your future home? Besides the purchase price of the flat, there are other costs and fees that you will need to pay at various stages of your flat buying journey. But don’t sweat it – check out our simple guide below!

Booking Your Flat

When you book your flat, you will need to pay the option fee, which varies based on the type of flat you’ve booked:

The good news is that the option fee is considered as part of your downpayment, which you have to pay when you sign the Agreement for Lease.

Signing of Agreement for Lease

Besides the downpayment for your flat, you will need to pay stamp duty and legal fees. Basically, you pay HDB  to act as your solicitor in the purchase and/or mortgage of your flat. In contrast, for other property transactions, you would typically get a private solicitor to act on your behalf.

You can use IRAS’ handy Stamp Duty Calculator to calculate your stamp duty. For conveyancing fees, the rates are:

• First $30,000: $0.90 per $1,000
• Next $30,000: $0.72 per $1,000
• Remaining Amount: $0.60 per $1,000

The minimum legal fee chargeable is $20, and it is subject to GST.

Key Collection

You’re now on the home stretch (pun intended)! Besides paying the balance of the flat purchase price, you will also need to pay stamp duty and legal fees. Yes, again, but this time it includes the following – depending on whether HDB acted for you in the purchase and/or mortgage of your flat:

• Survey fee: $150 to $375, depending on flat type
• Lease In-Escrow fee: Fixed at $38.30
• Mortgagee solicitors’ bill (only payable if you are taking a housing loan from a financial institution)

You will also need to pay for the Home Protection Scheme (HPS), a mortgage-reducing insurance scheme offered by the CPF Board. Note that you must be insured under the HPS if you want to use your CPF OA to pay off your mortgage.

In the event of permanent disability or death before you turn 65, the CPF Board will pay the outstanding housing loan amount, based on the amount insured under HPS. You can pay the annual premiums using either your CPF savings or cash, and you can estimate your premium amount using CPF Board’s calculator. For more on the HPS, check out the CPF Board website.

Finally, if you’re taking a housing loan from HDB, you must buy fire insurance from HDB’s appointed insurer, FWD Singapore Pte Ltd. The coverage and premiums vary based on flat type – for more details, visit FWD’s website.

HDB has recently launched the Flat Portal, a one-stop portal that streamlines the process of buying and selling flats. Beyond flat listings and details on BTO projects in current and upcoming Sales Launches, customised financial calculators can also be used for budget and payment planning. Additionally, home buyers can also get information on housing loans offered by HDB and participating financial institutions.

Source: mynicehome.gov.sg

A Guide to CPF Housing Grants

Buying a flat is a big financial commitment, so you might be glad to know that there are several housing grants available to help you offset the purchase price of the flat and embark on your home ownership journey.

Do you know which grants you’re eligible for, or how much you can get? Here’s a handy guide that breaks down all you need to know about housing grants.

1. Enhanced CPF Housing Grant (EHG)

Who is eligible for the EHG?

First-timer citizen households and first-timer single citizens can apply for the EHG when buying a new flat from HDB or resale flat on the open market, subject to prevailing eligibility conditions. Resale flat buyers must qualify for the Family Grant or Singles Grant (whichever is applicable) to be considered eligible for the EHG.

If you’re buying a flat as a first-timer family, your average gross monthly household income must not exceed $9,000. If you’re a first-timer single, your average gross monthly income must not exceed $4,500.

What are the flat types eligible for EHG?

Generally, the EHG is applicable to both new and resale flats, for all flat types and locations. However, for first-timer single citizens, the applicable flat type would depend on the eligibility scheme and whether you are buying a new flat or resale flat. Do note though that the flat needs to have a remaining lease of at least 20 years.

How much grant can I get with the EHG?

*The flat must have sufficient lease to cover the youngest buyer to the age of 95 –otherwise, the EHG will be pro-rated

Read here for more details on EHG.

2. Family Grant

Who is eligible for the Family Grant?

You may be eligible if you’re a first-timer household buying a resale flat on the open market, and your average gross monthly household income does not exceed $14,000.

What type of flat can I buy to be eligible for the Family Grant?

2-room or bigger resale flat with a remaining lease of at least 20 years.

How much grant can I get with the Family Grant?

** May later be eligible for the Citizen Top-Up – a $10,000 housing subsidy – when a qualifying household member becomes a Singapore Citizen

Any other grants I could be eligible for?

• Enhanced CPF Housing Grant
• Proximity Housing Grant

Read here for more details on the Family Grant.

3. Singles Grant

Who is eligible for the Singles Grant?

If you’re a first-timer single Singapore Citizen (35 years old and above) buying a resale flat with average monthly household income not exceeding $7,000, you may be eligible!

What type of flat can I buy to be eligible for the Singles Grant?

2-room to 5-room resale flat, with a remaining lease of at least 20 years.

How much grant can I get with the Singles Grant?

Any other grants I could be eligible for?

• Enhanced CPF Housing Grant for Singles
• Proximity Housing Grant

Read here for more details on the Singles Grant.

4. Proximity Housing Grant (PHG)

Who is eligible for the PHG?

This grant is for those who are buying a resale flat on the open market to live with or close to their parents and/ or married children.

What type of flat can I buy to be eligible for the PHG?

* The flat needs to have a remaining lease at least 20 years.

How much grant can I get with the PHG?

Any other grants I could be eligible for?

• Family Grant
• Singles Grant
• Enhanced CPF Housing Grant

Read here for more details on the PHG.

5. Step-Up CPF Housing Grant

Who is eligible for the Step-Up CPF Housing Grant? What type of flat can I buy to be eligible for the Step-Up CPF Housing Grant?

You may apply for this grant if you currently own a 2-room subsidised flat in a non-mature estate and are applying to upgrade to a subsidised 3-room flat in a non-mature estate.

Second-timer families who are rental tenants may also be eligible for the grant if they buy a 2- or 3-room flat in a non-mature estate.

How much grant can I get with the Step-Up CPF Housing Grant?

$15,000

6. Half Housing Grant

Who is eligible for the Half Housing Grant?

Couples comprising a first-timer citizen applicant and second-timer applicant, with an average gross monthly household income of less than $14,000, and buying a resale flat on the open market, may apply for the Half-Housing Grant.

What type of flat can I buy to be eligible for the Half Housing Grant?

2-room or bigger resale flats with a remaining lease of at least 20 years.

How much grant can I get with the Half Housing Grant?

The quantum of the Half Housing Grant is half that of the Family Grant.

Do remember that if you sell your flat that was purchased with the help of CPF grants, all CPF monies used will be returned to your CPF Account – so you can use it for your next housing purchase, or retirement and healthcare needs!

Source: mynicehome.gov.sg

A Guide to Buying a Resale HDB Flat

Are you looking to buy a resale HDB flat but unsure of how the entire journey is like? Here’s a 5-step guide on how you can purchase a resale flat from the open market.

1. Check Your Eligibility

Before you start the process, first check if you are eligible to purchase a resale flat. Register your Intent to Buy through the HDB Resale Portal to receive an instant assessment on your eligibility to buy a resale flat. The Portal will also automatically retrieve and populate your particulars from the Government’s MyInfo service.

Learn more about the Resale Portal here.

2. Plan Your Finances

Before you dive into searching for a resale flat, set aside time to do your math. Use our Budget Calculator and Payment Plan Calculator to get estimates of resale-related costs and fees, the estimated housing loan amount, and CPF housing grants applicable to resale flat buyers.

3. Search for an HDB Flat

Now that you’ve done the necessary checks and financial planning, it’s time to look for an HDB flat that meets your budget and needs. You can engage a property agent to assist you in the search, or trawl property sites to shortlist suitable ones.

4. Obtain an OTP from the Seller

Once you have decided on the resale flat that you would like to purchase, you need to obtain an Option to Purchase (OTP) from the seller via the HDB Resale Portal. After the seller grants you an OTP, a Request for Valuation will be submitted to HDB. Following the valuation report, you (flat buyers) will have to decide whether to exercise the OTP.

5. Submit Resale Application

Should you decide to exercise the OTP, both you and the seller must submit the respective portions of the resale application on the HDB Resale Portal. HDB will then contact both parties to come down to HDB Hub to attend a resale completion appointment, to endorse documents which require ‘wet-ink’ signatures.

There you have it – you are 5 steps closer to getting a resale flat of your own!

Source: mynicehome.gov.sg

A Guide to the Enhanced CPF Housing Grant (EHG)

To make housing more affordable and accessible to Singaporeans, eligible first-time flat buyers can apply for an Enhanced Housing Grant (EHG) of up to $80,000.

What is EHG?

The EHG is a CPF housing grant for first-time flat buyers applying for a new Build-To-Order (BTO) flat or buying a resale flat in the open market. It helps to make housing more affordable and accessible to Singaporeans.

How much EHG am I eligible for?

Eligible first-timer applicants for new flats can enjoy an EHG of up to $80,000, while eligible first-timer singles can enjoy an EHG (Singles) of up to $40,000.

Similarly, eligible first-timer households buying a resale flat can also enjoy an EHG of up to $80,000, in addition to the CPF Housing Grant (up to $50,000) and Proximity Housing Grant (up to $30,000). This means that first-time resale homebuyers can enjoy up to $160,000 in housing grants!

How does EHG work?

To qualify for EHG, the monthly household income for first-timer families should not exceed $9,000 (refer to Table 1 below). Eligible first-timer singles must be aged 35 and above, with a monthly income of less than $4,500. In both cases, the buyer or his/ her spouse must be in continuous employment for the 12 months prior to the date of flat application and remain working at the point of flat application.

Table 1: EHG Structure

*The EHG is applicable for those buying 2-room Flexi flats on 99-year leases in the non-mature estates, 2-room Flexi flats on short leases, and resale flats (up to 5-room under the Single Singapore Citizen Scheme, and all flat types under the Joint Single Scheme).

^The EHG amount is applicable to households buying a flat with a remaining lease that can cover the buyers and their spouses to the age of 95; otherwise, the household will enjoy a pro-rated EHG.

New Flat Applicants

For first-timer households*, the EHG is applicable for all flats, regardless of flat type and location.

*First-timer single citizens buying a flat under the Single Singapore Citizen scheme or Joint Singles Scheme, are only eligible to buy 2-room Flexi flats.

For example, Couple A has an average monthly household income of $4,800 and is looking to buy a 4-room BTO flat in Tampines, a mature estate. With the EHG, Couple A can enjoy an additional $45,000 in housing grants:

Example 1

Resale Flat Buyers

Eligible first-timer households buying a resale flats can enjoy up to $160,000 in housing grants, which includes the EHG (up to $80,000), CPF Housing Grant (up to $50,000) and PHG (up to $30,000).

For example, Couple B who are both Singapore Citizens with an average monthly household income of $4,800, is buying a 4-room flat in a mature estate to live near their parents. They can enjoy a CPF Housing Grant of $50,000, an EHG of $45,000 and Proximity Housing Grant (PHG) of $20,000.

Table 2: CPF Housing Grant

Table 3: Proximity Housing Grant

What happens if the remaining lease of the flat I buy does not cover the youngest owner till the age of 95?

To enjoy the full EHG amount for the relevant income brackets, the purchased flat must have sufficient lease to cover the buyers and their spouses to the age of 95. Otherwise, the amount of grant will be pro-rated. This condition also applies to repurchased flats under the Sales of Balance Flats or Re-Offer of Flats exercises.

For example, Couple C, both aged 30, with an average monthly household income of $4,800, has purchased a resale flat with a remaining lease of 60 years. As the flat cannot cover them to the age of 95, they can enjoy an EHG of $40,000 as opposed to the full EHG amount of $45,000 for their income bracket.

In a Nutshell

Eligible first-timer applicants for new flats can enjoy up to $80,000 in housing grants while eligible first-timer singles can enjoy an EHG (Singles) of up to $40,000.

For eligible first-timer households buying a resale flat, they can enjoy up to $160,000 in housing grants, which includes the EHG (up to $80,000), CPF Housing Grant (up to $50,000) and PHG (up to $30,000).

Whether you are applying for a new BTO flat or buying a resale flat, remember to factor in the EHG when planning for your new home!

Read this guide to learn about other CPF housing grants available for home buyers.

Source: mynicehome.gov.sg