From choosing a BTO unit to purchasing a flat in the resale market. Here's how you can own your own HDB flat if you're 35, single, and Singaporean.
So you're single and living it up, and the next milestone is to get your own HDB flat. You can finally avoid the pointed questions from your parents. Or, you can get bumped up another rung on the #adulting ladder.
It wasn't so long ago that owning an HDB flat was but a pipe dream for single Singaporeans. Back then, the best you could do was to rope in a parent as a co-lessee, and hope they don't go nosing around too much while you're away at work.
Today, HDB's rules have been tweaked. They recognise that many Singaporeans are putting off marriage until they're older and that singlehood is an acceptable lifestyle. So if getting your own home is high on your to-do list, here's a quick guide to the options you have available to you.
WHAT ARE THE HDB ELIGIBILITY REQUIREMENTS FOR SINGLES?
First things first, HDB flats are only available to Singaporeans or PRs. You have to be at least 35 years old to apply as an unmarried or divorced individual. The only exception is if you are an orphan with no siblings; you may apply for your own flat upon turning 21 under the Orphan's Scheme.
Unrelated singles who are 35 years or older can also jointly apply for an HDB flat - up to 4 such individuals can co-own a flat this way under the Joint Singles Scheme.
The only other eligibility requirement is the EIP and SPR quota (used to encourage and maintain social cohesiveness). However, this is more likely to impact your flat's location, rather than act as a hurdle against your eligibility to apply for one.
WHAT HDB FLATS CAN SINGLES BUY?
As a single buyer, you have 2 choices when it comes to HDB apartments - a 2-room BTO HDB flexi flat, or a resale HDB flat. The table below presents a quick summary of the pros and cons of both options.
|WHICH HDB FLATS SHOULD
|2-Room BTO HDB Flexi Flat
|Resale HDB Flat|
(approx S$75,000 to S$158,000)
(approx S$250,000 to S$343,000 for a 3-room flat)
|Longer waiting time
(average 3 to 4 years)
|Shorter waiting time
(You can complete your purchase in as little as 6 months)
|Restricted to 2-room units (35 sqm to 45 sqm)||No restrictions in flat type, starting from 3-room flats (65 sqm and up)|
|Lower availability||Higher availability|
|Brand-new apartment||Pre-owned apartment|
|Full 99-year lease||Shorter lease period remaining|
|Cannot sub-let||Can sub-let|
BTO 2-ROOM FLATS ARE AFFORDABLE, BUT RESTRICTED IN SIZE
The biggest advantage of getting a BTO flat is a financial one - BTOs are priced significantly cheaper than those on the resale market. However, unmarried individuals are restricted to 2-room* Flexi units only, even if there are multiple co-applicants.
With 1 bedroom and 1 living room, the total floor space of such units range from 36 sqm to 45 sqm.
Clearly, a 2-room flat is small, but if you apply for one under the BTO scheme, you'll be getting a brand-new apartment that you can renovate to suit your needs. For example, the current 36 square meter model has a sliding partition in lieu of a solid wall, allowing you to realise an open floor plan apartment.
The May 2019 BTO exercise saw 1499 applicants for 2 room Flexi units (1 applicant per unit), and 3986 applicants for 3 room and bigger units (5.7 applicants per unit).
But beware the waiting time. Even if you're lucky enough to be successful in your ballot, you'll still need to wait around 3 to 4 years for your flat to be built before you can move in.
* When referring to HDB flats, always subtract '1' from the name to determine how many bedrooms you'll be getting. So a 3-room flat means 2 bedrooms + 1 living room, 4-room means 3 bedrooms + 1 living room, etc.
RESALE FLATS COST FAR MORE BUT ARE AVAILABLE IMMEDIATELY
If balloting (and waiting) for a BTO 2-room unit doesn't appeal to you, you can try looking for a suitable apartment on the resale market. Singles - whether individually or jointly - can purchase any type of HDB resale they desire, provided they can afford it.
The main disadvantage of buying a resale flat is the cost. At present, and reasonably for the next 30 years or so, the smallest resale HDB you can probably buy is a 3-room unit.
(HDB flats have a minimum occupancy period of 5 years, and with current supply not yet meeting demand, it is unlikely you'll find any 2-room units on the resale market anytime soon.)
The prices of HDB resale flats have been steadily coming down, thanks to government cooling measures. This has helped put resale flats within reach of most single buyers. However, you should still expect to pay around S$250,000 to $369,000 for a 3-room HDB resale unit.
If your resale flat has less than 60 years remaining on its lease, you'll be limited in how long you can use your CPF to pay for your mortgage. This means that as your mortgage matures, you'll have to pay more cash out of your pocket. Do bear this in mind when planning your finances.
After you've located and purchased your own HDB resale flat, you'll most likely have to/want to carry out some major renovation work. Anecdotal evidence suggests that you should budget S$30,000 for a 3-room flat, S$40,000 for a 4-room flat, and S$50,000 for a 5-room flat for renovation.
As a single homeowner, you'll undoubtedly find a resale flat more expensive to own. However, a resale unit offers you one financial advantage that a 2-room BTO does not.
If you don't need the extra rooms, you can rent them out to generate some additional income. Granted, there are pros and cons to sharing your home with renters but don't underestimate the financial possibilities that leasing can open up.
TO SUM IT UP…
Owning your own place in Singapore is a big decision due to the amount of financing it involves. Whether you get a flat at 35 through the Singles Scheme or the Joint Singles Scheme, it is important to check the criteria for eligibility in each scheme. Besides that, single Singaporean Citizen applicants may also be eligible for the Singles Grant or Additional CPF Housing Grant (AHG) (Singles).
By being informed of these grants and loans that you can apply for, you may find ways to cushion the costs of purchasing your own home - allowing you to fully relish the freedom that comes with being a homeowner.
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This article was first published in SingSaver.com.sg.