Executive Condominium & HDB income ceiling to increased: PM Lee
Additionally, Special CPF Housing Grant expanded to cover more families with income ceiling that was increased
Housing policy changes announced by Prime Minister Lee Hsien Loong in his National Day Rally speech on Sunday were seen as efforts to enhance home ownership for house renters in addition to the middle- income and classes that were sandwiched, while promoting inclusiveness at the same time.
Four changes were announced by Mr Lee.
He explained this is always to let more Singaporeans to buy new HDB flats and ECs. This really is also in light of couples marrying later and crossing the income ceiling by the time they have settled down. 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 vehicle – will be increased from S$12,000 to S$14,000.
The second has to do with all the Special CPF Housing Grant (SHG), that will be expanded to cover more homes. This can be done by raising the grant’s household income ceiling of S$6, 500 to S$8,500. From only half of all families, two-thirds of homes will qualify, up with this previously. The existing maximum SHG quantity of S$20,000 will also be doubled to S$40,000.
“The result? A median family buying a flat that previously received S$10,000 of SHG will now receive S$30,000 – three times as much,” Mr Lee said.
The 3rd change he declared was targeted at home renters who are back living in rental flats, and had purchased a flat before but sold it.
This group of rental renters are difficult to help, because they have benefited from previous HDB subsidies, because that would not be fair to others and also the authorities cannot only give them another grant, Mr Lee said.
But it could be challenging for them to afford another flat. These families also often face many other difficulties associated with relationships, their jobs, and children’s instruction. Their home issue is an outcome of the other difficulties, Mr Lee noted.
“I am really worried about the future of this group. Without help, a flat of their own may be permanently out of reach. They will be caught in poverty, as well as their kids will be impacted, also it will perpetuate the cycle into the following generation.”
The government has decided to execute a “Fresh Start Housing Scheme” to help these second-timer rental families own a two-room flat. These flats will come with resale conditions that are more stringent and shorter leases to make them more affordable. The government may also support the family with counsellors to help them to solve their difficulties.
This really is in line with Singapore wanting to make sure that no one is left behind, said Mr Lee.
The fourth change sees the introduction of a Closeness Housing Grant, tailored at couples that are planning to buy a resale flat with or near their parents, or parents looking to reside 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 along with flat prices have stabilised, following the launch 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, however a ramp up in building in the last three years has helped to clear this backlog. According to Mr Lee first-timers are now able to decide on 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 boost the demand on the top and bottom ends, by boosting the number of those who qualify for public housing and ECs.
“The government is addressing house affordability and lowering the barriers of entry to boost home ownership, following the cooling measures they have introduced,” he said.
More Singaporeans might have a likelihood of possessing public housing, by boosting the ceiling.