HDB

Buying A Resale HDB Flat Without Govt Grants As Your First Home In Singapore. Does It Make Sense?

If we don’t take government grants when buying a resale flat, we will still be considered a “first-time” buyer.

by
Dinesh Dayani
January 11, 2022

Given the long waiting time to getting a BTO flat and rising HDB resale home prices, the DollarsAndSense editorial team discuss the merits of buying a resale HDB flat today as a starter home – without using government grants.

HDB Resale Prices Have Been Increasing

In the first part of the discussion, we talk about the overall increase in price of the property market in Singapore. Even though the private property market had been steadily rising since 2017, resale HDB flats only began to increase in price around the same time as when the pandemic began.

Nobody can be entirely sure if prices will come back down to pre-COVID-19 prices in the short-term, if at all. Our editor Timothy says that prices will never come back down to what it was 10 to 20 years ago in any case – so if we need a home, we don’t have to fixate on it. Of course, it’s logical to think that short certain COVID-19-related cost pressures such as foreign labour shortage and material cost may ease after the pandemic passes, but no one really knows if or whether it will actually happen.

Are HDB Resale Flats Really That Expensive?

In the next part of the conversation, we talk about whether Singaporeans really have a better home option than resale HDB flats. Moderator of the discussion, Dinesh, says that it’s not entirely fair to compare prices to the BTO market. This is because certain groups of people cannot participate in the BTO market. And, even if we wanted to, we have to wait about 4 to 5 years for the BTO flats to be built. Resale HDB flats given us a home right away – similar to condominiums, which is what we should be comparing prices against. In addition, if we buy a resale HDB flat, we can still qualify to buy a BTO in future.

Should We Buy Our HDB Resale Flats Without Government Grants?

In the final part of the discussion, Angela mentions that we can also get government grants when buying HDB resale flats – similar to when we buy a BTO flat. The team then discusses the pros and cons of doing this. The most obvious advantage of not using government grants when buying a resale HDB flat is that we get to retain our “first-time buyer” status if we ever want to go back into the BTO market – perhaps after getting married in the future or applying with a family member.

Listen to the full podcast episode here: Buying A Resale HDB Flat Without Govt Grants As Your First Home In Singapore. Does It Make Sense?