New Reporter
17-02-23, 11:08
Some 10,000 first-timer households will benefit from increased housing grants in first year: MND
Feb 16, 2023
THE increase in Central Provident Fund (CPF) Housing Grants announced in Budget 2023 will benefit over 10,000 first-time homebuyers in its first year of implementation, said the Ministry of National Development (MND) on Thursday (Feb 16).
This was in response to media queries on the impact of increasing housing grants on an already sizzling hot resale market.
Around a third of resale flat buyers have received the housing grant in the past two years, MND said.
According to latest HDB data, resale transactions in 2022 fell 10 per cent from 31,017 units to 27,896 units. This was still higher than the 23,714 units sold in 2019 and 24,748 units in 2020.
The ministry emphasised in its statement that it is “mindful” of the potential impact of increasing housing grants, which is why these grants are for first-time homebuyers – and more specifically, those with incomes below S$14,000 for families and S$7,000 for singles.
On Tuesday, Finance Minister Lawrence Wong announced that more support will be given to first-time homebuyers when buying resale public housing.
For eligible first-timer families buying a two to four-room resale flat, the CPF Housing Grant will be increased from S$50,000 to S$80,000. For homebuyers purchasing a five-room or larger resale flat, the grant amount will increase from S$40,000 to S$50,000.
For singles, the amount is halved – at S$40,000 for singles buying a two to four-room resale flat, and S$25,000 for those buying a five-room resale flat.
Even so, analysts cautioned that the support may instead prop up demand and prices for resale flats, especially for larger units or those in popular locations. This is mainly because certain buyers would have a bigger housing budget, resulting in some sellers raising their asking prices.
MND highlighted in its statement on Feb 16 that resale transactions are ultimately determined on a willing-buyer-willing-seller basis.
“Sellers who raise their asking prices might run the risk of pricing themselves out of the market as buyers remain price-conscious, given the high interest rates and uncertainties in the global economy,” it said.
The ministry also acknowledged that the increase in resale prices has caused anxieties among some first-time homebuyers. “While we have responded decisively with two rounds of cooling measures in December 2021 and September 2022 and are seeing early signs of moderation, these measures will take time to work through the market.”
It added that the government will continue monitoring the resale market “to ensure it is in line with economic fundamentals” and “will act decisively, if needed”.
Further details on the changes will be shared at MND’s upcoming Committee of Supply debate.
https://www.businesstimes.com.sg/property/some-10000-first-timer-households-will-benefit-increased-housing-grants-first-year-mnd
Feb 16, 2023
THE increase in Central Provident Fund (CPF) Housing Grants announced in Budget 2023 will benefit over 10,000 first-time homebuyers in its first year of implementation, said the Ministry of National Development (MND) on Thursday (Feb 16).
This was in response to media queries on the impact of increasing housing grants on an already sizzling hot resale market.
Around a third of resale flat buyers have received the housing grant in the past two years, MND said.
According to latest HDB data, resale transactions in 2022 fell 10 per cent from 31,017 units to 27,896 units. This was still higher than the 23,714 units sold in 2019 and 24,748 units in 2020.
The ministry emphasised in its statement that it is “mindful” of the potential impact of increasing housing grants, which is why these grants are for first-time homebuyers – and more specifically, those with incomes below S$14,000 for families and S$7,000 for singles.
On Tuesday, Finance Minister Lawrence Wong announced that more support will be given to first-time homebuyers when buying resale public housing.
For eligible first-timer families buying a two to four-room resale flat, the CPF Housing Grant will be increased from S$50,000 to S$80,000. For homebuyers purchasing a five-room or larger resale flat, the grant amount will increase from S$40,000 to S$50,000.
For singles, the amount is halved – at S$40,000 for singles buying a two to four-room resale flat, and S$25,000 for those buying a five-room resale flat.
Even so, analysts cautioned that the support may instead prop up demand and prices for resale flats, especially for larger units or those in popular locations. This is mainly because certain buyers would have a bigger housing budget, resulting in some sellers raising their asking prices.
MND highlighted in its statement on Feb 16 that resale transactions are ultimately determined on a willing-buyer-willing-seller basis.
“Sellers who raise their asking prices might run the risk of pricing themselves out of the market as buyers remain price-conscious, given the high interest rates and uncertainties in the global economy,” it said.
The ministry also acknowledged that the increase in resale prices has caused anxieties among some first-time homebuyers. “While we have responded decisively with two rounds of cooling measures in December 2021 and September 2022 and are seeing early signs of moderation, these measures will take time to work through the market.”
It added that the government will continue monitoring the resale market “to ensure it is in line with economic fundamentals” and “will act decisively, if needed”.
Further details on the changes will be shared at MND’s upcoming Committee of Supply debate.
https://www.businesstimes.com.sg/property/some-10000-first-timer-households-will-benefit-increased-housing-grants-first-year-mnd