Homebuyers to have ‘greater’ flexibility with CPF usage: HDB

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/ EdgeProp
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August 28, 2018 12:16 PM SGT
Homebuyers will have “greater” flexibility when using their CPF accounts to purchase public flats, the HDB announced on Tuesday.
Those purchasing public flats will have the option of retaining $20,000 in their CPF Ordinary Account (OA) - a dedicated savings account for housing, insurance, investment and education purposes - and use the remaining balance to pay for their HDB flat purchase. Previously, flat buyers had to fully use up the balance in their CPF OA before taking up a HDB housing loan.
“The funds can be used for their monthly mortgage instalments in times of need and will improve retirement adequacy if left unutilised,” it said.
In line with the new policy, “HDB loans may become more popular among buyers as they can possibly take a larger loan due to the higher LTV [loan-to-value ratio], and also [have] a stable interest rate”, says Eugene Lim, key executive officer of ERA Realty.
The policy change will cover homebuyers who purchase flats under the 2018 Build-To-Order (BTO) and Re-Offer of Balance Flats (ROF) scheme announced on Tuesday. Those who have yet to collect keys to their new flats, as well as those looking to purchase resale flats, are also eligible.
August BTO and ROF exercise
Under the latest BTO and ROF scheme, the HDB has launched 5,101 flats in total: 4,375 are BTO flats for sale across four projects in Punggol and Yishun, while 726 flats are for sale under ROF, across various estates in Singapore.
Table: August 2018 BTO Prices (Source: HDB)
At least 85% of four-room and five-room flats, and 70% of three-room flats, out of the BTO supply are set aside for first-time families, it added.
Meanwhile, up to 15% of two-room flexi units and three-room flats under BTO are carved out for parents applying under the Multi-Generation Priority Scheme (MGPS), the scheme that helps married children and their parents obtain new flats in the same precinct. The same number of units will be allocated for children staying close to their parents.