Also, Special CPF Housing Grant extended to cover more families with increased income ceiling.
Mr Lee announced four changes . Primarily, the income ceiling for HDB flats will be increased from S$10,000 to S$12,000, while that for executive condominiums (ECs) – a public-private housing hybrid – will be increased from S$12,000 to S$14,000.
He said this is always to permit more Singaporeans to purchase new HDB flats and ECs. National Development Minister Khaw Boon Wan had previously suggested at this move in June, noting that incomes have gone up since the ceiling was last raised in 2011. That is also in light of couples crossing the income ceiling by enough time they have settled down and marrying later.
The second has to do with the Special CPF Housing Grant (SHG), which is expanded to cover more families. This will be done by increasing the grant’s household income ceiling of S$6, 500 With this particular, two thirds of households will qualify, up from only half of all households formerly. The existing maximum SHG amount of S$20,000 will also be doubled to S$40,000.
The third change he pronounced was targeted at house renters who had bought a flat before but sold it, and are back living in rental flats.
This group of rental renters are difficult to assist, because they have already benefited from preceding HDB subsidies, because that would not be fair to others as well as the authorities can’t merely give them another grant, Mr Lee said.
But without a grant, it would be challenging for them to manage another flat. These families also have a tendency to face many other problems related to their jobs, relationships, and children’s education. Their housing difficulty is an outcome of these other problems, Mr Lee noted.
“I am really worried about the long run of this group. Without help, a flat of their own may be permanently out of reach. They are going to be caught in poverty, and their kids will probably be affected, also it is going to perpetuate the cycle into another generation.”
The government has decided to implement a “Fresh Start Housing Scheme” to help these second-timer rental households possess a two-room flat. These flats can come with more rigorous resale conditions and shorter leases to create them more affordable. The government will also support the family with counsellors to assist them to solve their problems.
The fourth change sees the introduction of a Proximity Home Grant, tailored at couples that are looking to buy a resale flat with or near their parents, or parents looking to live near their married children. Mr Lee said details will be announced by the Ministry of National Development later.
All these changes are kicking in now that build to order the queues for flats shortened and also flat costs have stabilised, after the launching of 100,000 HDB flats since 2008.
A BTO supply crunch which could not match first-time buyers’ demand fast enough in 2011 had led to criticisms of long waiting times, but a ramp-up in building within the last three years has helped to clear this backlog. Based on Mr Lee, most first-timers can now choose a flat in a non -mature estate on their very first try.
Desmond Sim, head of Singapore and South-east Asia at CBRE Research, said the higher income grants and ceilings can help raise the demand on the bottom and top ends, by improving the number of those who qualify for public housing and ECs.
“The government is addressing dwelling affordability and lowering the barriers of entry to enhance home ownership, following the cooling measures they have introduced,” he said.
More Singaporeans can get a possibility of owning public housing, by boosting the ceiling. So can home renters that will get a “second bite of the cherry” at subsidized housing underneath the new scheme, he said.