Incomes have kept pace with prices of new HDB units, resale flats

HDB subsidies for new and resale flats keep public housing affordable; among resale flat buyers who have taken up an HDB loan, the mortgage servicing ratio has remained stable at 23%.

New Housing and Development Board (HDB) units and resale flats continue to remain affordable as incomes of Singaporeans have generally kept pace with their prices over the last few years, said the Ministry of National Development (MND) in Parliament on Tuesday (2 November).

The ministry revealed that HDB applies a significant subsidy to the flat’s assessed market value when pricing new flats, to ensure that such flats remain affordable.

It made the statement in response to MP Yip Hon Weng, who asked whether the income of Singaporeans has kept up with the costs of Build-to-Order (BTO) and HDB resale flats.

In its reply, MND noted that eligible first-time BTO buyers could get up to $80,000 in Enhanced CPF Housing Grant (EHG).

“For resale flats, the Government provides housing grants of up to $160,000 to ensure resale flats remain affordable for eligible first-timer families,” it said.

Commenting on MP Chua Kheng Wee Louis’ question on the current pace of HDB resale price hikes, MND said the Government is committed to “ensuring a stable and sustainable property market where prices move broadly in line with economic fundamentals”.

It attributed the recent increase in prices partly to a broad-based increase in housing demand, supported by the low interest rate environment.

Despite the increases, MND said HDB resale flats remain affordable.

“On average, the mortgage servicing ratio, which is the proportion of monthly income used to service mortgage instalment payments, has remained stable at 23% among resale flat buyers taking an HDB housing loan, over the past three years,” it said.

This means buyers generally need little or no cash outlay to service their resale flat’s payments as their mortgage loans could be paid using CPF contributions.

To meet housing demand, HDB is on track to launch around 17,000 BTO units this year, up from the 14,600 flats launched in 2019 and the 16,800 flats in 2020.

Including the 5,300 units under the Sale of Balance Flats (SBF) exercises and open booking, HDB will offer a total of 22,300 flats this year.

“HDB will continue to ramp up the flat supply, and will launch more than 17,000 flats in 2022 to meet the strong demand,” it said.

“At the same time, we are continuing to monitor the economic and property market conditions very closely, and will ensure that public housing remains affordable and accessible for Singaporeans,” added MND.

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Cheryl Chiew, Digital Content Specialist at PropertyGuru, edited this story. To contact her about this story, email:

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