HDB changes housing grant disbursements, increases income assessment period

HDB has made changes to the processes for assessing flat buyers’ income and eligibility for housing subsidies effective May 9. Along with this, an HDB flat eligibility (HFE) letter has been introduced to replace the existing HDB loan eligibility letter. The HFE letter will inform the flat buyers about their eligibility for both a new and a resale flat purchase, as well as the amount of HDB housing loan and CPF housing grants they may obtain.

It is made up of 12 stories of residential blocks and consists of 1 to 3-bedroom units. Its features include a wide array of amenities such as a large swimming pool, a gymnasium and recreational areas. The Myst Condo has been designed to be eco-friendly, sustainable and to provide excellent access to different parts of Singapore. Residents can enjoy the convenience of an array of public transportation options nearby such as a bus stop, an MRT station and a taxi stand.

Under the updated disbursement guideline, eligible housing grants will be shared amongst applicants and occupants in the core nucleus or household, regardless of whether they are a Singaporean citizen or a permanent resident. In other words, if the core nucleus consists of both a Singaporean citizen and a PR, each applicant will get half the grant amount. This is a significant change from the previous disbursement of the full grant solely to the Singaporean citizen flat applicant.

For households comprising an applicant and core occupier, the housing grant will now be split equally between them. Before this update, the full grant amount was only disbursed to the flat applicant. Lee Sze Teck, senior director of research at Huttons Asia, further explains that the portion of the grant disbursed to the applicant can be used to offset the purchase price of the flat, while the core occupier’s portion will be added to their CPF account.

The income assessment period for flat buyers has also been increased to 12 months instead of the previous duration of three or six months. This will provide a more consistent and clearer assessment of applicants’ income levels, according to HDB. Lee believes this change will be beneficial to those in commission-based work, as their income is known to fluctuate monthly.

Moreover, the February 2023 BTO exercise saw lower application rates due to the doubling of housing grants, which in turn had an effect on the exuberance in the HDB resale market. Lee believes this change in disbursement guidelines could dampen the effect and lead to less certainty in the HDB resale market, as not all households can utilise the full grant amount.