In a Facebook post by HDB it was shared with the public on how it is possible to own your first HDB flat with zero or very little cash upfront.
They had posted this in their page:
“Q: Is it possible for first-timers to purchase an HDB flat with zero or very little cash outlay?
A: Yes, it is! We’ve done the math based on the typical selling prices of 3-room and 4-room flats in non-mature estates based on our applicants’ median household income for 2019.”
So how does the maths go about some may ask, but please note that it’s only for first timers who do not own another property.
It was stated in their example, well if say purchasing a new 3-room flat (non-mature estate).
Say if your median household income is $3,800, the typical price for that unit is about $270,000.
You use the 10% downpayment from your CPF $27,000 (must have ah, if not don’t think about it please),
your enhanced CPF Housing Grant (EHG) is $55,000 (for lower to middle income families)
You still have a Family Grant of $50,000 (combined income not more than $14,000 as a couple or $21,000 if applying with extended family.
Proximity Housing Grant of $20,000 (staying near parents ah)
So after you deduct of all the above, your balance amount for your purchase and HDB housing loan only comes to $118,000.
That makes your monthly instalment plan at only $536 (instalment to income ratio = 14%).
So how? Use your CPF lah… based on your median income, you can contribute from your Ordinary Account to pay for your home amounting to $536.
And magic! You don’t need to pay any cash for your purchase!
So what about 4-room? Don’t gan chiong… it’s below…
Calculate if your median household income is $5,000, the typical price for that unit is about $329,000 they say.
Same using the 10% downpayment from your CPF $32,900 (if don’t have save up more or buy 3-room ok, don’ say they never give you chance),
use the enhanced CPF Housing Grant (EHG) is $45,000 (for lower to middle income families)
After deducting all the above, your balance amount for your purchase and HDB housing loan only comes to $251,100.
So your monthly instalment plan at only $1,140 (instalment to income ratio = 23%).
It’s calculated that based on your median income, you can contribute from your Ordinary Account to pay for your new home that amounts to $1,140.
All fully paid without using cash!
All information sources are from Housing Development Board.