Proximity Housing Grant: Response encouraging, resale flats more affordable

20% of resale flat buyers seek proximity grant
Many benefiting from aid in buying units with or close to parents or children: Minister
By Janice Heng, The Straits Times, 31 Oct 2015

More than one in five Housing Board resale flat buyers have applied for the Proximity Housing Grant since it was introduced in August, Minister for National Development Lawrence Wong said in a blog post yesterday.

The grant was one of several housing changes that kicked in on Aug 24, the day after the National Day Rally. Said Mr Wong: "Just two months on, I am happy to see many home buyers already benefiting."

The grant - $20,000 for families and $10,000 for singles - is for those buying resale flats with or close to their parents or married children.

Out of 3,506 resale transactions from Aug 24 to Oct 23, a total of 737 buyers applied for the grant. Of these, 684 applications were from families and 53 from singles.

Ms Ellen Neo, 26, applied for the grant with her fiance on the very day that it was launched.

The couple are getting a five-room resale flat in Shunfu to be close to her parents, who live in Bishan.

"It's a great help to us because the flat is going to be quite expensive. We're very thankful that we managed to get the grant," said Ms Neo, who is currently not working.

Mr Wong noted that the grant had deliberately been made available to all, with no household income ceiling.

Even those who have enjoyed housing subsidies or owned private property in the past are eligible.

"We did this because we recognise that the desire to live closer to parents and children is shared by a wide spectrum of Singaporean households, and not just first-timer couples," he said.

Nearly half of the families and about nine in 10 of the singles who applied for the proximity grant would have been ineligible for grants under previous rules.

R'ST Research director Ong Kah Seng said the grant is also "very timely in helping the resale flat market". The transaction volume hit a record low of 17,318 last year.

Higher income ceilings have also benefited many home buyers over the last two months, said Mr Wong.

The CPF Housing Grant income ceiling was raised to $12,000 for families and $6,000 for singles, up from $10,000 and $5,000 before.

Of 1,081 first-timer resale applications tapping this grant, 128 were newly eligible. About half were from families and half from singles.

Mr Wong said that since taking up the housing portfolio this month, he has received appeals from buyers looking for a new flat near their parents or children.

"But such new flats are not always available, especially in mature estates. With the enhanced schemes, these home buyers can now consider resale flats in their preferred locations."

Household income ceilings were also raised for new executive condominium (EC) units, to $14,000 from $12,000 before.

Of the 607 bookings, 174 were by newly eligible applicants. Among them was Mr G.M. Salahuddin's family, who applied for the Sol Acres EC in Choa Chu Kang on Aug 25, right after they heard about the change.

"It was very good news," said the 44-year-old shipping industry professional, whose wife works in the same industry. "Buying a private condominium would have required much more savings."