CPF, HDB housing loan rules for buying older properties updated

Thu, May 09, 2019


HOME buyers will now have greater flexibility to use their CPF when buying older homes as long as the remaining lease of the property can cover the buyer until they turn at least 95 years of age.

In an announcement on Thursday, the Ministry of National Development (MND) and the Ministry of Manpower (MOM) said that rules on CPF usage and HDB housing loans have been updated to provide increased flexibility for Singaporeans to buy a home for life.

If the remaining lease of the property is at least 20 years and covers the buyer until they turn 95 years of age, buyers can use their CPF to pay for the property up to the valuation limit of the property. This applies to both HDB flats and private property. There will still be a minimum lease requirement for the use of CPF for property purchases - this is being lowered to 20 years from the current 30 years.

For older HDB flats, buyers will be able to take an HDB housing loan of up to the full 90 per cent loan-to-value (LTV) limit if the remaining lease of the flat can cover the buyer up to the age of 95. If the remaining lease of the flat does not meet that criteria, the buyer can still take an HDB loan but the LTV limit will be pro-rated.

Prior to this, buyers of HDB flats faced restrictions on the amount of HDB housing loan they could secure to buy a flat with a remaining lease of less than 60 years.

The new rules kick in from May 10.

Meanwhile, to ensure they secure a basic level of retirement income, CPF members will need to have a property with sufficient remaining lease to cover them until the age of 95 before they can withdraw their CPF savings above the basic retirement sum (BRS).

Previously, CPF members above the age of 55 could withdraw their CPF savings above the BRS if they owned a property with a remaining lease of at least 30 years.