SINGAPORE – The higher housing grant announced during Budget 2023 could raise Housing Board resale flat prices for smaller flats in popular locations, said property analysts.
They expect the revised Central Provident Fund Housing Grant, which has increased by up to $30,000, to shift some demand to the HDB resale market, especially for four-room and smaller flats in mature or sought-after locations, as this group of buyers will receive the most grants. Sellers could take the chance to raise prices, they added.
On Thursday, the Ministry of National Development (MND) said it is “mindful of the potential impact of increasing grants in a buoyant resale market”.
That is why the increased grants are specifically targeted at eligible first-timer home buyers with household monthly incomes below $14,000 for families and $7,000 for singles, and do not go to all buyers, said MND in response to queries.
About a third of resale flat buyers received the CPF Housing Grant in the last two years, it noted, adding that it will closely monitor the market and act decisively if needed.
Deputy Prime Minister and Finance Minister Lawrence Wong had on Tuesday announced an increase of between $5,000 and $30,000 in the CPF Housing Grant for first-timer families and singles buying HDB resale flats.
First-timer families buying two- to four-room HDB resale flats can now get a grant of up to $80,000, up from $50,000. Those who buy five-room or larger units can get $50,000, up from $40,000. Singles, meanwhile, can get up to $40,000 for four-room and smaller units, up from $25,000. Those who buy five-room units can get $25,000, up from $20,000.
This means that buyers can either opt to take a smaller loan and reduce their monthly mortgage payments, or cast their net wider for a resale flat as they have an increased budget.
