Do you really need a 5-room HDB flat?

Getting your first property and not sure how many rooms you want to have? Not sure about the differences in size and floor area between 3-room, 4-room and 5-room flats? Check out this handy guide that will help you decide how much space you really need!

Finding the perfect balance between price and space

Here are HDB’s specifications of 3, 4 and 5 room flats, as well as their average resale prices.

If budget permits, most young couples tend to opt for 4-room and 5-room flats, considering 3-room flats are a lot smaller. Nevertheless, you should weigh your options based on how much you’re earning and how much space you need.

Use this calculator on the HDB portal to find the maximum housing loan ( HDB or bank loan ) you’re eligible for, depending on your income. It also helps you calculate the estimated monthly instalments. It’s important not to overstretch yourself, and always make sure you’ve got rainy day savings you can draw on in case of emergency.

CPF Housing Grants

Whether you’re getting a BTO or resale flat, you may be eligible for CPF Housing Grants as well.

If you’re a first-timer applicant buying a BTO flat with a gross monthly household income of at most S$9,000, you may be eligible for the Enhanced CPF Housing Grant (EHG). The grant amount depends on your income. Currently, the maximum grant amount is $80,000.

The maximum grant amount is double at $160,000 if you’re getting a resale flat. Besides the Enhanced CPF Housing Grant, you may also be eligible for the Family Grant (up to $50,000) and Proximity Housing Grant (up to $30,000).

Find out more about these CPF Housing Grants here.

ALSO READ: HDB grants guide 2022: What's the max CPF housing grant you can get?

Key considerations when buying a flat

If you’re leaning towards getting a resale flat, do keep in mind that flats in the 1990s had, on average, 10per cent more floor space than flats built from 2000 onwards. What does this mean? Well, with a resale flat, you might be able to get a flat with less rooms, but still effectively have roughly the same floor space.

1. Is your household getting bigger?

Another thing that you should keep in mind is whether you want to have kids soon, or if your parents are likely to require assistance and move into your home in future. Both of these situations will mean that you’ll need to allocate some space for them.

The alternative is to upgrade, but it isn’t quite as simple as just selling and re-purchasing when your family gets bigger. Firstly, there’s your Minimum Occupation Period (MOP) of five years, during which you’re not allowed to sell your flat or buy any new residential properties (be it private or public).

Secondly, if you sell your flat and buy a second BTO, you’ll have to pay a resale levy. That’s $40,000 if you’re selling a 4-room flat, and $45,000 if you’re selling a 5-room flat.

So if you don’t plan to upgrade to a bigger house right after the MOP, this means that you’ll live in your first property for quite a number of years. So be sure to plan carefully and consider what’s likely to happen in the near horizon.

2. Work and lifestyle needs

Think about your lifestyle and how this will impact the amount of space you need. If you have family living abroad and you’d like to have a spare room handy for them when they visit, that means that you’ll need more space.

And with hybrid work becoming more common since the pandemic, you’ll most probably need a separate workspace if you work from home.

Make the distinction between the must-haves and good-to-haves. If you continue to work from home, having a separate study is likely to be a must-have.

Wanting more space for a walk-in closet? That’s a good-to-have.

Similarly, the balcony and larger living room space that you’ll get when you choose a 5-room over a 4-room flat is likely to be a good-to-have. So these shouldn’t be key factors in your decision-making process unless you have more than enough money to finance your purchase.

Your purchase decision is a significant one that will continue to impact you for a few decades to come. So take some time to do more research and weigh the pros and cons. When it comes to considering which flat type to buy, only buy one that’s within your means.

Good luck!

This article was first published in 99.co.