Singaporeans now have more flexibility to buy forever homes

Rules on pension funds updated without compromising retirement adequacy

Headquarters of the Central Provident Fund, a compulsory comprehensive savings plan for working Singaporeans and permanent residents. macashop/Shutterstock

Singaporeans will now have more opportunities to buy a home for life and still retain their retirement adequacy, thanks to rules implemented this month on Central Provident Fund (CPF) usage and Housing & Development Board (HDB) housing loans.

If the remaining lease of the home can cover the youngest buyer until at least the age of 95, home buyers will be allowed to obtain maximum CPF usage and HDB housing loan (for HDB flat buyers), according to new rules announced Friday.

Those who do not meet this criteria will still be able to use CPF and take up an HDB housing loan, but the amount will be pro-rated.

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The changes are expected to make minimal impact on majority of home buyers as they are already purchasing a property which lasts them to the age of 95, the Ministry of National Development stated.

“By raising the age to 95, the pool of buyers who can utilise pension funds to buy older flats will increase,” Christine Sun, the head of research at OrangeTee & Tie Pte, told Bloomberg Quint.

“The increased demand may stabilise the price gap between older and newer flats.”

Previously, buyers could only use their CPF savings if the remaining lease of the property covers the youngest buyer until the age of 80.