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Joint Press Release by MND & HDB - Further support for First-time Homebuyers
Further support for First-time Homebuyers
Increased CPF Housing Grant for resale flat buyers;
Greater priority during BTO applications for First Timer families with children and young married couples aged 40 years and below buying their first home
To make public housing more affordable and accessible for young families buying their first homes, Deputy Prime Minister and Minister for Finance, Mr Lawrence Wong, announced in the Budget Statement in Parliament today that the Government will:
a) Increase the CPF Housing Grant for eligible first-time buyers of resale flats by up to $30,000, from the current maximum grant amount of $50,000 to $80,000. Eligible First-Timer families who submit their resale applications on and from 14 Feb 2023, 3:30pm will qualify for this increased CPF Housing Grant. The additional grant amount will be credited into their CPF account from Apr 2023 onwards.
b) Give greater priority during BTO applications to First-Timers families with children and young married couples aged 40 years and below who are buying their first home. This will be implemented later this year.
Against the backdrop of the broad-based increase in demand for housing in recent years, these measures will help more families with children and young married couples own their first home.
2 The current tightness in BTO supply has been driven by several factors, especially the disruption to HDB flat construction that was caused by the COVID-19 pandemic, as well as a shift in social norms, as Singaporeans increasingly want to move out and live on their own, instead of living with their parents.
3 Across our engagements with Singaporeans, including as part of the ongoing Forward Singapore exercise, young families have shared their concerns over securing their first home. To meet the increased housing demand, we have ramped up the supply of BTO flats by 35% to 23,000 in 2022 and will continue to launch 23,000 BTO flats this year. Since the August 2022 BTO sales exercise, we have also set aside at least 95% of 4-room and larger BTO flats for First-Timer families.
4 The additional measures announced by DPM Lawrence Wong at Budget 2023 will complement the existing measures and further support families looking to purchase their first home.
Increase in Maximum Amount of CPF Housing Grant for First-Timers Buying Resale Flats
5 The resale market meets the housing needs of first-time homebuyers who may have specific locational preferences such as living near their parents for mutual care and support, or a desire to secure homes sooner. However, the current strong HDB resale market may pose affordability challenges for some homebuyers.
6 The Government implemented two rounds of cooling measures in Dec 2021 and Sep 2022, and we are seeing some moderation in the rate of increase in resale prices. The launch and completion of more BTO projects over the next few years will further help ease demand and prices for resale flats. We are watching the situation closely, and will act decisively but carefully if needed to ensure a stable property market. Nonetheless, to further improve the affordability of resale flats, we will provide even more support for First-Timers through an increase in the CPF Housing Grant amount.
7 Currently, eligible First-Timers buying a resale flat can receive up to $160,000 in housing grants. This comprises the CPF Housing Grant of up to $50,000, Enhanced CPF Housing Grant of up to $80,000, and Proximity Housing Grant of up to $30,000. HDB will increase the CPF Housing Grant from $50,000 to $80,000 for eligible First-Timer families buying a 4-room or smaller resale flat, and from $40,000 to $50,000 for First-Timer families buying a 5-room or larger resale flat. Eligible First-Timer singles will similarly receive an increased CPF Housing Grant from $25,000 to $40,000 when buying a 4-room or smaller resale flat, and from $20,000 to $25,000 when buying a 5-room resale flat. With these increases, eligible First-Timer families buying a resale flat can then receive up to $190,000 in housing grants. For eligible First-Timer singles, the revised housing grants can be up $95,000. Details of the revised grants are shown in Tables A1 and A2.
Table A1: Revised Grant for Eligible First-Timer Families
Table A2: Revised Grant for First-Timer Singles*
Note: *First-timer singles buying a 2- to 5-room resale flat are eligible for the grant.
8 For eligible buyers who submit their resale applications on or after 1 Apr 2023, HDB will disburse the increased grant quantum before resale completion, as per current practice. For eligible buyers who have yet to complete their resale transaction by 3:30pm on 14 Feb 2023, or submit their resale applications on and from 3:30pm on 14 Feb 2023 to 31 Mar 2023, HDB will disburse the additional grant quantum (i.e. the difference between the increased grant and the current grant) within three months from the date of their resale completion. They do not need to approach HDB and will not face any disruption to their resale completion.
Greater priority during BTO applications for First-Timer families with children and young married couples aged 40 years and below buying their first home
9 HDB offers BTO flats to meet the housing needs of diverse buyer groups, including First-Timer families, Second-Timer families, seniors and singles. The vast majority of HDB’s BTO flat supply is already set aside for First-Timer families as they have more pressing housing needs. First-Timer families also receive more ballot chances, compared to second-timer families.
10 The First-Timer category currently covers a wide range of applicants, including those who already have their own homes, but have not received housing subsidies before. HDB will introduce a new sub-category of First-Timers comprising families with children, and young married couples aged 40 years and below, who are buying their first home. This sub-category of prioritised First-Timers will receive additional support, including an additional ballot chance for their BTO applications, to support them in securing their BTO flats in a more timely manner. This will be implemented later this year and more details of the scheme as well as eligibility criteria will be shared at the Ministry of National Development Committee of Supply debate.
11 The Government remains committed to keeping public housing affordable and accessible, to meet the housing needs of Singaporeans. The measures announced today supplement existing measures to address the current tight BTO supply, and enable more genuine first-timer applicants to own their first home.
Grants Available for First-Timers Buying HDB Flats
The Government is committed to helping Singaporeans own their first homes. In pricing new flats, the key consideration is to ensure affordability for flat buyers, especially First-Timers. HDB first establishes the market value of the flat by considering the prices of comparable resale flats nearby, as well as the individual attributes of the flat and the prevailing market conditions. A significant discount is then applied to the assessed market value so that new flats are priced below market value and are affordable for first-time homebuyers across different income levels.
On top of pricing new flats below market value, HDB offers various housing grants to ensure that flats remain affordable and accessible. Eligible First-Timer flat buyers can enjoy the Enhanced CPF Housing Grant (EHG) of up to $80,000, which provides further support to lower- and middle-income families buying their first home. Those with more pressing housing needs may consider resale flats on the open market where First-Timer flat buyers can enjoy housing grants of up to $190,000.
Families and singles* buying a new or resale HDB flat
Families and singles* buying a resale flat to live with or within 4km of their parents or child/children
(up from $50,000 previously)
(up from $25,000 previously)
Up to $190,000#
Up to $95,000#
*First-Timer singles buying a 2- to 5-room resale flat are eligible for the grant.
#With effect from 1 April 2023