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Helping Rental Tenants Buy a Flat of Their Own
HDB’s public rental flats are for low-income citizen households who cannot afford to buy a flat and have no other housing options or family support. The rents of these flats are heavily subsidised, to help those in real need. You may apply for one if you meet this set of eligibility criteria.
HDB is committed to helping public rental tenants who are in steady employment, or are financially stable to progress to home ownership. In the long term, homeownership is a better solution for families than rental, because it provides a greater sense of stability. They will also be able to use their CPF monies to pay for a flat of their own, instead of paying rental in cash.
We have introduced several assistance measures for our rental flat tenants to progress onto home ownership when they are ready. Our measures include:
With Enhanced CPF Housing Grants of up to $80,000, their first flat will become even more affordable. They can use the grants to pay part or all of the downpayment, and reduce their loan amount.
Fresh Start Housing Grant
Under the Fresh Start Housing Scheme, eligible second-timer rental families* with children can enjoy a Fresh Start Housing Grant of up to $50,000, to buy a new 2-room Flexi flat with shorter lease or a 3-room flat with shorter lease.
Step-Up CPF Housing Grant
Eligible second-timer rental families can receive a Step Up Housing Grant of $15,000, if they are looking to buy a 2-room or 3-room, new or resale flat in a non-mature estate.
They will be given priority in sales exercises. Up to 10% of available 2-room Flexi and 3-room BTO/ SBF flats will be set aside for them under the Tenants’ Priority Scheme.
A dedicated team of HDB officers will guide and support rental tenants who are ready to buy a flat. The officers will advise them on their housing budget and options, the grants and schemes available to them, and help them through the flat buying process from application to key collection.
If they require help in other areas such as employment support and financial assistance with their children’s school fees, etc, we will also link them up with social service agencies.
*To qualify for Fresh Start, the family has to meet the following criteria:
a) The applicant(s) must be at least age 35 and below age 55, and form a second-timer family nucleus. At least one parent must be a Singapore Citizen (SC), and they must have at least one SC child aged 18 or younger.
b) The applicant(s) must have occupied a public rental flat for at least one year, without accumulating three or more months of rental arrears at any point in the preceding 12 months.
c) At least one applicant is employed at the point of flat application and has been in continuous employment for the preceding 12 months.
The family must qualify for the Letter of Social Assessment (LSA) from HDB. To do so, they will be assessed based on (i) family stability, (ii) employment stability, (iii) ability to manage their finances well, and (iv) regularity of school attendance for all children below 16 years old. The LSA will be valid for 1 year, and must be renewed annually until 5 years after key collection.
Mr and Mrs Tan, aged 40, are second-timers. They are living with their 12-year-old child in a 2-room public rental flat. Mr Tan is the sole breadwinner, earning $1,400 a month. They are currently paying monthly rental of $240 in cash.
If they apply for a 2-room flexi flat with a 60-year lease under the Fresh Start Housing Scheme (Fresh Start), they will be eligible for up to $35,000 in housing grants. Assuming they have cash/ CPF savings of $35,000, they would need a housing loan of about $65,800, which they will be able to qualify for with their household income. The monthly mortgage instalment of $300, over a loan tenure of 25 years, can be paid mostly through their CPF contributions of $290. The remaining $10 can be paid by cash. This will free up more cash for their daily needs.
Mdm Lim, who is divorced with a young child, was a rental tenant of a 1-room flat. She wanted to buy a flat of her own to provide a stable home for her child. However, having bought a flat from HDB previously, she no longer qualified for the CPF Housing Grant.
When officers from HDB’s Home ownership Support Team learnt of Mdm Lim’s case, they helped her to apply for a Step-Up CPF Housing Grant of $15,000, and guided her through the flat buying process. With the grant, Mdm Lim has since gone on to buy a 3-room resale flat in a non-mature estate. She and her child now have a home to call their own.