The recent announcement on the new HDB grants comes as a pleasant surprise to Singaporeans who are planning to buy their first HDB. Effective 11 September 2019, these revisions will help make HDB ownership more affordable for first-timers.
What are the latest changes to the HDB grants and how does it impact you?
Increased Income Ceiling for First Time Buyers
In tandem with rising household income, HDB is now raising the income ceiling requirement to benefit more people.
The previously lower income ceiling has slowly lost its relevance with the increase in median income, inflation and rising costs. Homebuyers whose total income exceeded slightly above the threshold of the old scheme were feeling the pinch when they could not qualify for the grants.
Thankfully, with this generous new amendment, more Singaporeans can now be eligible for the grants. Homeownership will now be within reach for many.
The family household income ceiling has been raised for the following:
- BTO flats: S$12,000 to S$14,000
- Executive Condominiums: S$14,000 to S$16,000
More Choices of HDB Flats for First-Time Buyers
Unlike the past where grants are limited to certain types of HDB flats, the new grants offer eligible first-time homebuyers more choices in terms of flat type and location.
Previously, grants are only given for BTO purchases. Resale flats are subjected to market prices, making it a more expensive home option.
With the new scheme, first-time owners of either BTO or resale units will qualify for the grant.
Since location is no longer a restriction, potential homebuyers can now afford the pricier BTOs and resale units in more matured locations.
For Singaporean couples, the grants for resale units range from S$40,000 to S$50,000 depending on the size of flat or EC. Couples where one is Singaporean and the other a PR, the grant ranges from S$30,000 to S$40,000 depending on size of flat or EC.
New Enhanced CPF Housing Grant (EHG) to Replace Existing Additional and Special CPF Housing Grants (AHG and SHG)
With so many HDB grants available, keeping track of the HDB grants can be confusing for many laypeople.
Because of this, HDB has taken a more simplified approached by replacing both AHG and SHG with the newly Enhanced CPF Housing Grant (EHG).
Prior to this change, there were three types of grants:
- CPF Housing Grant (CHG) of $50,000,
- Additional CPF Housing Grant (AHG) of up to $40,000
- Special CPF Housing Grant (SHG) of up to $40,000
Following the previous HDB grant scheme, those buying BTO flats may be eligible for all 3 grants, while those buying resale homes are only eligible for the CHG and AHG.
However, the new EHG guideline has increased the income cap up to S$9,000 and is offering higher subsidies to first-time purchasers of BTO or resale units. The grant ranges from S$5,000 to S$80,000 depending on your income tier.
Example of the 2 extremes in household income and EHG value:
- Couple A’s household income is less than S$1,500. They qualify for EHG up to S$80,000.
- Couple B’s household income is S$9,000. They qualify for EHG up to S$5,000.
If you are residing near your parents, you stand to benefit from the Proximity Housing Grant (PHG) of S$30,000. Now, isn’t this a wonderful motivation to foster a close-knitted family?
For eligible families who are buying their second HDB flat, the monthly household-income ceiling for the Fresh Start Housing Scheme and Step-Up CPF Housing Grant is raised from S$6,000 to S$7,000.
Also, with the increased monthly household income of S$12,000 to S$14,000, eligible seniors will also benefit via the Silver Housing Bonus (SHB). By right-sizing from a larger unit to a two-room or three-room flat, seniors can receive up to $20,000 cash bonus per household subjected to fulfilling CPF requirements.
Are You Buying Your First Home to Start a Family?
The new HDB grants provide a good boost towards owning your first HDB. If you are planning to settle down soon, this is an added incentive to do so.
Once you receive the keys to your new home, renovations to make your home a sanctuary is in the near horizon. Aurastone offers premium quartz countertops and leakproof sinks for your dream kitchen. Contact us for a chat with our friendly experts.