YOUth Should Know: How the Enhanced CPF Housing Grant helps first-time flat buyers

Since the Enhanced CPF Housing Grant (EHG) was introduced in September 2019, it has benefitted close to 50,000 households’ first homes in HDB flats.

Serving as one of three housing grants for first-time buyers, the EHG is especially catered towards lower to middle income families and provides funds for them applying for a HDB flat, regardless of flat type and location.

It is implemented to keep housing affordable and accessible, according to the Housing & Development Board. 

If eligible for all three – the EHG, the Proximity Housing Grant and the CPF Housing Grant, those under the family scheme can bring their total grant amount up to $190,000.

According to Minister for National Development Desmond Lee, using the EHG could give new buyers “the option of servicing their monthly mortgage loans solely through their CPF” without cash outlay, which was something that 80 per cent of successful first-time buyers did in 2022.

Here are four things youths should know about the EHG and its requirements:

First-time buyers are allowed to pick either a new or resale HDB flat and still be eligible for the EHG. They can purchase flats from various sales modes, such as Build-to-Order (BTO), Sale of Balance Flats and Open Booking of flats.

If eligible for the EHG, families can receive up to $80,000 when buying a new or resale HDB flat. The family scheme is available for fiancé and fiancée, married couples and/or parent(s) with children, multi-generational families, and orphaned siblings.

There are no restrictions as to where the estate is, and buyers can choose any flat type as well.

When the flat application is approved and the buyer is eligible for the EHG, the grant amount will be fully credited into his or her CPF Ordinary Account instead of being paid in cash.

This amount can be used to help offset the HDB flat’s purchase price, or reduce its housing loan.

If the applicant applied for a flat under the family scheme, the core family members – which comprises the buyer, their spouse and other family members that helped the household meet the EHG’s eligibility criteria – will receive equal shares of the grant amount.

All core family members should remain together during the application process, as well as during the flat’s minimum occupation period of five years. They should not apply for another HDB flat, sell or rent the flat during this time.

In order to be eligible for the EHG, applicants’ families should have an average monthly household income of not more than $9,000. 

As the Grant caters towards lower to middle income households, it will not be given to those that do not fall within this monthly income range.

Buyers and their spouse should also hold continuous employment for at least 12 months before applying for a HDB flat, and remain working at the point of application.

While first-time flat buyers may purchase resale HDB flats from both mature and non-mature estates using the EHG, its remaining lease needs to be of at least 20 years.

The HDB flat’s remaining lease should be able to cover the buyers and their spouse until they are 95 years old. Otherwise, the flat will be prorated and they will be charged for the duration they are living in it.

For more information, youths may apply for a HDB Flat Eligibility Letter to get a better idea of housing and financing options, as well as their eligibility for housing grants.