SINGAPORE – More Singaporeans will be eligible to buy new Housing Board flats and executive condominiums (ECs) as the Government will be raising the income ceiling of buyers. The existing executive condo includes The Terrace EC and Brownstone EC while upcoming ones include Signature At Yishun EC and The Criterion EC.
The income ceiling for couples buying new flats will go up from $10,000 to $12,000, while that for ECs will increase from $12,000 to $14,000.
Prime Minister Lee Hsien Loong announced this on Sunday at the National Day Rally.
He said that HDB flats will always be affordable and accessible to all.
In the last five years, big changes have taken place in the housing market, he noted.
The prices of new Build To Order (BTO) flats have stabilised and 100,000 HDB flats were launched – the equivalent of four Clementi towns. The waiting time for a BTO flat has also shortened, and most first-time buyers can now select a flat in a non-mature estate on their first try.
The changes to income ceilings will mean now, at the higher end of households, more Singaporeans will be eligible for subsidised housing.
Explaining the change, Mr Lee said income ceilings were last raised four years ago, and since then, incomes have gone up further. The backlog for first-time buyers has also been cleared.
The ceiling for HDB flats was $8,000 and for ECs $10,000 before 2011’s change.
Minister for National Development Khaw Boon Wan had hinted about the changes earlier this year. Another reason for the increase is that couples now tend to marry later, when their incomes are higher, he had said.
Singapore’s median household income was $8,292 in 2014, according to figures from the Department of Statistics. It had risen by 17.8 per cent from $7,037 in 2011.
PM Lee also announced that the Special CPF Housing Grant (SHG) will be extended to more households, and the grant amount raised.
Households with incomes of $8,500 and below will now be entitled to a maximum grant of $40,000, up from $20,000. Before, only households with an income of $6,500 and below qualified for the grant.
“We will raise the ceiling to $8,500 so that two-thirds of all households qualify,” he said.
A household with a median income will now receive $30,000 in grant instead of $10,000 when buying a flat, he added.
The SHG income ceiling was raised from $2,250 to $6,500 in 2013. It is offered to lower and middle-income families and joint singles who are buying new four-room or smaller flats for the first time.
Mr Lee also noted that Mr Khaw recently restructured the two-room flat and studio apartment schemes.
The new Two-Room Flexi scheme merges and replaces the current studio apartment and two-room flat schemes, and allows applicants aged 55 and above more choices in lease length and flat type when buying a retirement home.
Said Mr Lee: “Two years ago, I showed you that if you earn $1,000 a month, you can buy a two-room flat. With the latest changes, even if you earn below $1,000, but hold a stable job and contribute to CPF regularly, you can still afford a two-room flat,” he said.
The Government will also launch a new scheme called the Fresh Start Housing Scheme, aimed at helping second-timer rental households own a two-room flat, PM Lee said.
The scheme caters to families that have owned a subsidised flat before but have sold it and now live in rental flats.
As these families have benefitted from previous HDB subsidies, the Government would not offer them another grant.
However, they will be offered two-room flats with shorter leases and stricter resale conditions, which are more affordable.
The family will also be supported with counsellors to guide them to solve their problems “holistically”, Mr Lee said.
“The family will have to play its part, and show that they are putting their lives in order, determined to get back on their feet, and putting their children through school,” he said.
“Over time, with help and guidance, through the Fresh Start Scheme they can own their own home again.”