LGBTQ+ guide: Things you should know about buying an HDB flat

Many would agree that  Singapore is leading the world in so many areas. However, one area it has much to catch up with is the attitude towards the LGBTQ+ community.

With 80 per cent of Singaporeans living in public HDB flats, it is probably the default home of choice for many LGBTQ+ individuals. Ask anyone in the community and most would mention buying a flat when they are 35 years old.

Truth is, that is probably all they know. Prident, a collective formed in 2020 has a group of LGBTQ+ professionals (myself included) volunteering to educate the LGBTQ+ individuals on the economic and well-being issues in Singapore. One very popular category is homeownership.

Thanks to the invitation from 99.co, I’ll be sharing my articles on the topic of LGBTQ+ and homeownership.  So let’s start with the subject of purchasing an HDB flat for an LGBTQ+ individual.

Public housing for LGBTQ+: A little history

Housing for singles has come a long way since the 1970s. The Singapore government was first hesitant in extending public housing to single individuals because there was high demand for flats, and the priority went to families. Flat ownership for singles was deemed inconsistent with the government social policy of encouraging marriage and the preservation of the traditional family unit.

Thankfully, the liberalisation of the housing policy towards singles came in Oct 1991, when it was announced that single Singaporeans aged 35 and above can purchase a flat from Housing and Development Board (HDB).

ALSO READ: Singles Singapore Citizen & Joint Singles Scheme (2021): How to buy HDB flats for singles

And since then, 35 years became the ‘unofficial’ age for single adults to get a home of their own. The policy also became a ‘leeway’ for many LGBTQ+ Singaporeans to buy an HDB flat for the very first time.

While HDB public housing remains to be the most affordable option for most Singaporeans, it comes with a lot of conditions. Knowing what one qualifies for is very important when planning to make an application.

Buying direct from HDB (BTO & Balance of Sales)

A single (LGBTQ+) person could buy from HDB  under 3 Schemes: Public, Singapore Citizen Single or Joint Single Scheme.

Under the Public Scheme (PS), the applicant must

• form a family nucleus with parents, and siblings (if any).
• At least one Singapore Citizen applicant
• At least one other Singapore Citizen or Singapore Permanent Resident
• At least 21 years old
• Household Income Ceiling: $14,000 (4-room and above); $7,000 or $14,000 (3-room, depending on project)

LGBTQ+ note: This is a very common scenario of singles who live with their elderly parents (with little or no income).

Often they will buy a flat with their parents as co-owners and use their income to secure a bank loan and tap into CPF to pay for the upfront and mortgage payment. However, the problem happens when they want to buy a place of their own in the future and realise that their name is tied to the property.

Under Singapore Citizen Single Scheme (SCSS) & Joint Single Scheme (JSS), the applicant can purchase directly from HDB BTO or Sale of Balance, under these conditions:

• Must be Singapore Citizen (up to 4 pax for Joint Single Scheme)
• Unmarried or divorced: 35 years old or above
• Widowed or an orphan: 21 years old or above
• Household Income ceiling $7K
• All applicants and occupiers listed in the flat application do not own other properties overseas or locally and have not disposed of any within the last 30 months
• All applicants and occupiers listed in the flat application cannot invest in private residential property from the date of flat application till after the 5-year Minimum Occupation Period (MOP).
• All applicants have not purchased a new HDB/ DBSS flat or EC, or received a CPF Housing Grant before; or, have only purchased 1 of those properties/ received 1 CPF Housing Grant thus far
• Importantly, the applicant(s) can only purchase a 2 Room Flexi Flat in the non-mature estate.
• Singles buying under SCSS must also pay a $15k premium on top of the listing BTO pricing. This is to ‘crawl’ back part of the subsidies built into a BTO pricing meant for couples.

Available grant for Single Singapore Citizen Scheme/ Joint Singles Scheme (JSS)

• Enhanced CPF Housing Grant (EHG)
• Up to $40k depending on income ($80k for JSS)
• Income cap at $4500 ($9000 for JSS)
• Have worked continuously for 12 months prior to the flat application
• Still, be working at the time you submitted the flat application
• Have minimum 20 years lease remaining. Flat must have sufficient lease to cover the youngest buyer to the age of 95 to qualify for the full EHG. Otherwise, the EHG will be pro-rated.
• You must not own any properties whether locally or overseas or have disposed of any such properties in the 30 months before your new flat application.

LGBTQ+ note: While BTO pricing is relatively more attractive. The long waiting time of 4-5 years for construction, followed by another 5-year MOP makes BTO unattractive for many LGBTQ+ who can only apply for BTO when they turn 35 years old.

Also, the limitation to only a 2-room Flexi flat in a non matured estate is not ideal for someone who would like a bigger space or prefer a location nearer to town. It is worth noting also that 2-rm Flexi is about 36-46sqm (387-495 square feet), equivalent to a studio or 1-bedroom apartment, and that may be too small for most LGBTQ+ couples.

ALSO READ: HDB launches over 4,900 BTO flats, including in Queenstown, Tampines and Jurong East

Buying from the open resale HDB market

Given the restrictive nature and limited options of BTOs, many LGBTQ+ are turning to the HDB resale market as an alternate home choice.

Under Single Scheme & Joint Single Scheme, single individuals can also buy from HDB Resale Market:

• They can buy any size and location from the open market.
• Must be Singapore Citizen (up to four pax for Joint Single Scheme)
• Unmarried or divorced: 35 years old or above
• Widowed or an orphan: 21 years old or above
• There is no income ceiling in the resale HDB market.

Available Grants For Resale HDB Flat

Singles Grant (only for Resale HDB)

• Single Scheme Income Ceiling $7k, Up to $25k
• Joint Single Scheme can apply for up to $50k (to two pax)

Enhanced CPF Housing Grant (EHG) (Singles)

• Single Scheme Income Ceiling $4.5k, Up to $40k
• Joint Single Scheme Combined Income Ceiling $9k, Up to $80k

Proximity Grant

• $10k grant if live near to parent (within 4km)
• $15k grant if living with parents

LGBTQ+ Note: The resale HDB is a very popular option with LGBTQ+ who likes to live in a convenient location and more mature estates. Many of them like to purchase older HDB flats and transform them into cosy pads with designer decor.

However, precaution has to be taken on the lease decay effect on HDB value. Many younger LGBTQ+ homeowners run the risk of outliving their old flats. Older HDB will also become increasingly difficult to sell in the future as the lease shortens.

Buying Executive Condo (EC) from HDB

Many are not aware that under the Joint Singles Scheme, singles individuals can also apply to buy EC from HDB. However, these are the conditions:

• You and up to three other co-applicants.
• Single (unmarried, divorced, or widowed)
• Singapore Citizens
• At least 35 years old
• Applying jointly as co-applicants
• Average gross monthly household income must not exceed $16,000.

LGBTQ+ note: Before getting all excited, do note that when buying an EC under the JSS scheme, NO GRANTS will be given to the applicants. So without the grant, and the long waiting period plus a 5-year MOP, the EC becomes less attractive of an option for LGBTQ+ buyers as they get older.

For LGBTQ+ permanent residents and foreigners:

Under HDB policies, single foreigners are not able to purchase HDB Flats. The only way a foreigner could buy an HDB is to marry a Singapore Citizen, but since gay marriage is not recognised here, that will not be an option for them.

ALSO READ: Home buyers in 5 BTO projects in Bukit Batok, Bukit Panjang, Clementi and Woodlands to face even longer wait; contractor cites 'financial difficulties'

A Singapore Permanent Resident (SPR) is only allowed to buy an HDB resale flat under two eligibility schemes, namely the Public Scheme (pairing with parents or siblings) or Fiancé/Fiancée Scheme (also not relevant to LGBTQ+ individuals) .  Basically,  SPRs cannot purchase resale HDB flats by themselves.

LGBTQ+ note: Now, not all hope’s gone for SPRs, there is an option to buy an Executive Condo (EC) from the resale market. Yes, that is correct, an EC that is past five years MOP can be purchased by Singaporeans and SPRs (but not foreigners) like a private property transaction. However, this does not apply to foreigners. They can only buy an EC only after 10 years when it is fully privatised.

So plan early, don’t wait till you are 35?

Property purchase requires careful planning and a substantial amount of funds. Many LGBTQ+ failed to save up when they were younger and started to panic when they are about to turn 35 in a month.  Reach out to an LGBTQ+ affirming realtor, or have a chat with a team member at PRIDENT to create a structured plan to get you started on your property journey.

This article was first published in 99.co.