Your Guide to CPF Housing Grants in Singapore
For many Singaporeans, the dream of homeownership is closely tied to the support provided by the Central Provident Fund (CPF) Housing Grants. These grants are designed to make purchasing a home more accessible and affordable, particularly for first-time buyers.
By reducing the upfront costs of a property, CPF housing grants play a pivotal role in easing the financial burden and helping individuals and families secure their dream homes. Understanding the various grants available and their eligibility criteria is, therefore, a crucial step in your property journey.
The CPF Housing Grant for Families is a key support for first-time Singaporean families buying HDB resale flats. To qualify, at least one core applicant must be a Singapore Citizen, forming a family nucleus, and generally be first-timers to HDB grants.
There is an income ceiling that determines your eligibility for this grant. For families purchasing a resale flat, the current ceiling is $14,000 in gross monthly household income. Eligible families purchasing a resale HDB flat can receive a grant of up to $80,000, depending on their income.
Enhanced CPF Housing Grant (EHG)
The Enhanced CPF Housing Grant (EHG) is a substantial financial aid that makes HDB flats more accessible to lower- to middle-income Singaporeans. This enhanced housing grant replaces previous schemes, offering up to $120,000, depending on household income.
Eligibility hinges on an average gross monthly household income not exceeding $9,000. Applicants must also be first-timers with at least 12 months of continuous employment prior to application. This EHG grant applies to both new and resale HDB flats with sufficient remaining lease.
Proximity Housing Grant (PHG)
The Proximity Housing Grant (PHG) is designed to encourage families to live closer, fostering stronger familial ties and support networks. This particular CPF housing grant offers financial assistance to those who buy a resale flat to live with or near their parents or married children.
To qualify for the PHG, the resale flat must be either within 4km of your parents’ or married child’s residence, or your parents/married children must live with you in the purchased flat. The grant amounts vary: families can receive $30,000 (if living with) or $20,000 (if within 4km), while singles can receive $15,000 (if living with) or $10,000 (if within 4km).
CPF Housing Grant (Singles)
For single Singaporean citizens dreaming of owning an HDB flat, the CPF Housing Grant for Singles offers valuable support. This HDB grant acknowledges their unique homeownership journey. To qualify, single applicants must be at least 35 years old if unmarried or divorced, or 21 if widowed or an orphan.
You must also be a Singapore Citizen, a first-timer, and earn a gross monthly household income not exceeding $7,000. Eligible singles can receive up to $40,000 for purchasing a resale HDB flat, significantly reducing the upfront costs and making independent homeownership more attainable.
How CPF Grants Can Reduce Your Property Costs
CPF housing grants can alleviate the financial burden of purchasing a home, mainly by reducing the upfront capital required. These grants directly lower your net purchase price, meaning you’ll need less cash or CPF savings for your downpayment and subsequent loan repayments.
Consider this: A first-time family eligible for the maximum Enhanced Housing Grant (EHG) could receive up to $120,000 in total. This substantial amount can be used to offset a portion of the property’s cost, making homeownership more accessible. Similarly, the Proximity Housing Grant can add another $20,000 to $30,000 for families living near loved ones, further decreasing the overall financial commitment.
By strategically utilising these CPF housing grants, homeowners can reduce their overall loan quantum. This not only lowers monthly mortgage instalments but also saves on interest payments over the long term.
Applying for CPF Housing Grants
Applying for housing grants is an integral part of your homeownership journey. The process is generally streamlined and integrated with your application.
When you apply for a flat, either directly from HDB (for Build-to-Order or Sale of Balance Flats) or a resale flat, your eligibility for various CPF housing grants will typically be assessed. For instance, the HDB Flat Eligibility (HFE) letter application on the HDB Flat Portal provides an upfront assessment of your grant eligibility alongside your HDB housing loan eligibility. This is particularly useful if you are considering a home loan for an under-construction property, as the HFE letter gives you a comprehensive financial overview early on.
If you are taking a bank loan, your chosen bank will also assist in assessing your grant eligibility and facilitating the application process as part of your overall home loan application. It’s advisable to complete your HFE letter application early to understand your grant entitlements. This can also help you understand your options should you need a bridging loan for HDB to cover the gap between selling your current flat and getting the funds for your new one.
Maximise Your Homeownership Potential
CPF Housing Grants are a cornerstone of Singapore’s housing policy, providing significant financial assistance to aspiring homeowners. By understanding the eligibility criteria and application processes for grants like the CPF Housing Grant for Families, the Enhanced CPF Housing Grant (EHG), the Proximity Housing Grant (PHG), and the HDB grant for singles, you can substantially reduce the cost of purchasing your home.
To ensure you maximise your grant potential and navigate the application process seamlessly, it’s always advisable to check your eligibility and seek professional guidance. A qualified mortgage advisor, like The Loan Connection, can offer personalised insights, helping you understand how these grants, alongside tools like a loan eligibility calculator in Singapore, can support your journey.
