How to Buy A HDB Resale Flat - A Complete Guide.

How to Buy A HDB Resale Flat – A Complete Guide

If you are looking for a HDB flat to start a family and are unwilling to wait about 4 years for a new Built-to-Order (BTO) flat to be completed, your next option is to buy a HDB resale flat or a private property, if you can afford one (refer to "How to Buy A New Launch or Resale private property"). But the whole process of buying a HDB resale flat can be a little daunting to some, especially for first-time buyers.

Fret not though! Below is a complete step-by-step guide on the whole procedure of buying your HDB resale flat. However, if you are looking for BTO flats, please refer to our guide on “How to Buy A HDB BTO Flat”. You may also wish to find out more about investing in HDB flats and executive condominiums, as well have an overview or Singapore's property market.


Eligibility Conditions to Buy a HDB Resale Flat

First of all, check the eligibility conditions to buy a resale flat under the various eligible schemes, such as Public Scheme, Single Singapore Citizen Scheme, Joint Singles Scheme, etc. To be eligible, you and your spouse must either be a Singapore citizen or Singapore permanent resident (SPR). If both of you are SPRs, you must have gained permanent residency for at least 3 years.

Married applicants must also be at least 21 years old. If an applicant is between 18 and 21 years old, parental consent must be obtained. If below 18 years old, a Special Marriage Licence from the Ministry of Family & Social Development (MSF) is required.

Singles are only eligible to buy when they turn 35 years old. However, there are exceptions, such as those who are widowed, orphaned or are single unwed mothers. You can check the full eligibility conditions here.


Income Ceiling

Although there is no income ceiling for the purchase of HDB resale flats, it will determine the amount of housing grants you will qualify for. Depending on your household income level, you may receive up to $180,000 consisting of $80,000 Family Grant, $80,000 Enhanced Housing Grant and $30,000 Proximity Grant.

For the Family Grant, $80,000 will be given to those who buy a 2- to 4-room HDB flat, and $50,000 for a 5-room or bigger flat if both applicants are Singapore citizens. If one of them is a Singapore permanent resident (SPR), the grant will be reduced by $10,000. However, the $10,000 will be reimbursed later should the SPR subsequently become a Singapore citizen. The maximum monthly household income ceiling to receive the grant is $14,000. Households earning above $14,000 a month will not be eligible to receive it.

For the Enhanced Housing Grant (EHG), it will be based on the level of household income as indicated in the table below. The household income ceiling for EHG is lower at $9,000 though.

First-Timer Families and Singles under Joint Singles Scheme Singles under Single Singapore Citizen Scheme
Average Monthly Household Income Grant Amount Average Monthly Household Income Grant Amount
$1,500 or less $80,000 $750 or less $40,000
$1,501 - $2,000 $75,000 $751 - $1,000 $37,500
$2,001 - $2,500 $70,000 $1,001 - $1,250 $35,000
$2,501 - $3,000 $65,000 $1,251 - $1,500 $32,500
$3,001 - $3,500 $60,000 $1,501 - $1,750 $30,000
$3,501 - $4,000 $55,000 $1,751 - $2,000 $27,500
$4,001 - $4,500 $50,000 $2,001 - $2,250 $25,000
$4,501 - $5,000 $45,000 $2,251 - $2,500 $22,500
$5,001 - $5,500 $40,000 $2,501 - $2,750 $20,000
$5,501 - $6,000 $35,000 $2,751 - $3,000 $17,500
$6,001 - $6,500 $30,000 $3,001 - $3,250 $15,000
$6,501 - $7,000 $25,000 $3,251 - $3,500 $12,500
$7,001 - $7,500 $20,000 $3,501 - $3,750 $10,000
$7,501 - $8,000 $15,000 $3,751 - $4,000 $7,500
$8,001 - $8,500 $10,000 $4,001 - $4,250 $5,000
$8,501 - $9,000 $5,000 $4,251 - $4,500 $2,500
More than $9,000 NA More than $4,500 NA

For the Proximity Housing Grant, $30,000 will be given to applicants who live with either of their parents and $20,000 if they live within 4 km of them.

For singles, the income ceiling and the respective grants will be half of that for a couple.


Household Income: $7,000

Resale HDB Flat Purchased: 5-room

Parents: Live within 4 km

Total Grants Received: $50,000 (Family Grant) + $25,000 (Enhanced Housing Grant) + $20,000 (Proximity Housing Grant) = $95,000


Ethnic Integration Policy (EIP)

Buyers must also comply with the Ethnic Integration Policy (EIP) that specifies the percentage of ethnic groups in each block and neighbourhood. For each block, the maximum limit for Chinese, Malay and Indian/Others are set at 87%, 25% and 15% respectively. For the neighbourhood, they are specified at 84%, 22% and 12%.


Singapore Permanent Resident (SPR) Quota

Besides EIP, there is also the Singapore Permanent Resident (SPR) Quota. For Non-Malaysian SPRs, the maximum limits for the block and neighbourhood are set at 8% and 5% respectively. Do note that Malaysians are treated similarly to Singaporeans due to their historical and cultural ties to Singapore. Hence, they will not be subjected to the SPR quota.


Ownership of Properties

You cannot have ownership of any properties if you wish to buy a HDB resale flat. These include HDB flats as well as private properties in Singapore or overseas. Should you own any of these, you must dispose of them within 6 months of purchasing your resale flat.


Minimum Occupation Period (MOP)

Check that sellers have completed their 5-year minimum occupation period (MOP). This excludes the period that they did not occupy the flat. For example, within that 5 years, they have worked overseas for 2 years. These 2 years are not counted as part of their MOP and hence, they are not eligible to sell although they have owned the flat for 5 years. Similarly, after buying the resale flat, you too must complete the 5-year MOP before you can dispose of it.


Work Out Your Budget

After confirming your eligibility to purchase a HDB resale flat, you will need to work out your budget, taking into account the amount of government housing grants you will be receiving. Then find out the transacted prices of HDB resale flats in different locations. Obviously, one nearer to town will likely be more expensive than those in the suburbs.

After doing your homework, you will have a better idea of the type of flat and the location you can afford. It is also important to be familiar with the commission structure of property agents.


Decide Where to Buy Your Resale Flat

One great advantage of buying a HDB resale flat is that you can choose the location of your choice. So, decide where to buy your resale flat – one that is near your parents, a shopping centre, a MRT station or a popular school to enrol your children in?

As compared to BTO flats, most are built in non-mature estates. Of course, some are built in matured estates such as the Prime Location Public Housing (PLH). However, they are not only more expensive, but the chances of getting one are also slim. Perhaps, the most anticipated PLH HDB flats will be those at Telok Blangah along the Greater Southern Waterfront.

As for PLH flats, they come with additional ownership criteria, like subsidy crawl back and a 10-year minimum occupation period (MOP).


What Housing Loan to Apply

Decide what housing loan to apply for – a HDB concessionary loan or a Bank loan? For a HDB housing loan, you can get up to 80% financing of the purchase or valuation price, whichever is lower. The balance of 20% can be paid in CPF &/or cash. For a bank loan, you can only get up to 75% financing of the purchase or valuation price. The balance of 25% must be paid in cash (minimum 5%) and the rest in CPF (see below).

At the same time, do take note of the Change In CPF Usage And Housing Loan Rules as this will impact on the amount of CPF funds for your purchase.

How to Buy A HDB Resale Flat: Loan-to-Value (LTV) Chart

Loan-to-Value (LTV) Chart

HDB Flat Application Process (New HDB Flat Eligibility (HFE) Letter)

Starting on May 9th, 2023, the Housing and Development Board (HDB) will implement a new application process for purchasing a flat. This process involves the issuance of a new document called the HDB Flat Eligibility (HFE) letter.

The purpose of this letter is to provide potential flat buyers with a comprehensive overview of their options for housing and financing before they begin the home-buying process.

The HFE letter will replace the current HDB Loan Eligibility (HLE) letter. It will inform prospective buyers about their eligibility for purchasing either a new or resale HDB flat, as well as their eligibility for CPF housing grants and a HDB housing loan.

The letter will also indicate the amounts of any grants or loans that they may be eligible for. Overall, the HFE letter aims to provide flat buyers with a clear understanding of their options and help them make informed decisions about their home purchases.

The new streamlined HDB flat buying process will integrate different eligibility assessments for HDB flat purchases, housing grants, and HDB housing loans into a single application through the HDB Flat Portal.

Hence, before being able to purchase a HDB flat, buyers will need to possess a valid HDB Flat Eligibility (HFE) letter when:

  1. They apply for a flat from HDB during a sales launch or open booking of flats.
  2. They receive an Option to Purchase (OTP) from a flat seller, as well as when they submit a resale application to HDB.

In other words, people who are interested in purchasing a flat from HDB or through a resale transaction, they must first obtain an HFE letter before proceeding with the purchase. This new requirement aims to ensure that flat buyers have a comprehensive understanding of their eligibility and financing options before they make any commitments to purchase a flat.


HDB Flat Eligibility (HFE) Letter Application Process

The HDB Flat Eligibility (HFE) letter application process consists of two steps that must be completed within 30 calendar days of each other.

Step 1: Preliminary HFE Check

Firstly, flat applicants must log in to the HDB Flat Portal using their Singpass to retrieve their personal information from Myinfo and provide other necessary information, such as household income and property ownership status.

Based on the information provided, HDB will generate an instant preliminary outcome which indicates the eligibility of the household to purchase a flat, receive CPF housing grants, and take up a HDB housing loan.

If the applicant intends to purchase a flat, they may proceed to the next step of applying for an HFE letter either immediately or within 30 calendar days.

Step 2: Apply for an HFE Letter

To apply for an HFE letter, all applicants and occupiers (if applicable) must log in to the HDB Flat Portal using their Singpass and fill in the application form with their personal details.

They will also be required to upload supporting documents where necessary. Within 21 working days of receiving the completed application, HDB will issue the HFE letter to the applicants, indicating their eligibility to purchase a new or resale flat, as well as the amount of CPF housing grants and HDB housing loan that they are eligible for.

Applicants will receive an SMS notification to log in to the HDB Flat Portal when their HFE letter is ready. The HFE letter will be valid for 6 months from the date of issue.

With the HFE letter, flat buyers will be guided on their home-buying journey through the HDB Flat Portal.

They will receive personalised information on their flat application, which will help them plan and prepare ahead at different stages of their flat purchase journey, such as working out their financial/ payment plans early.

When their flat is ready, flat buyers can also book their preferred appointment slot to collect their keys through the same platform.

If you have any queries about property investment, please WhatsApp or Email us.


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Posted in Property Guides, Property Resources.

Hi, I'm Lance Kuan, an Associate Marketing Manager at Huttons Asia Pte Ltd, one of the largest property agencies in Singapore.

With almost 30 years of experience in banking, investment and market analysis, I now find immense pleasure in helping others in property investment and asset progression.

My blog - Sg Home Investment - offers essential property reviews, research and guides to help buyers make an informed investment decision. Please feel free to WhatsApp Me if you have any queries about the real estate market in Singapore.