To make up for the shortage of affordable residential properties, the government has used the country’s two most successful housing schemes to help finance the implementation of the housing schemes that were not possible under the previous administration. The city-state is now looking forward to the implementation of the second phase of its housing reforms. A major focus of the implementation of these two schemes is the Enhanced CPF Housing Grant, and the property-backed second mortgage scheme called CPF Secured Loan.
The CPPF Home Improvement Grant has played a vital role in boosting the value of Singapore properties that were previously unattainable because of the value decline of the local currency. This CPF Housing Grant was initially awarded to project developers that have helped the city-state maintain its position as the second most expensive housing market in the world, only behind the USA.
The additional government support of this CPPF Housing Grant, which was granted to home buyers, has helped them acquire their dream homes at a cheaper rate. After the government’s announcement in November last year to enhance the CPF Housing Grant to enable residents to purchase a home, the value of residential properties soared, while those that are not priced too high, have started appreciating at a steady pace. To help finance this housing boom, the government has also launched a new home ownership scheme, the CPF Secured Loan, aimed at increasing the number of people who can own their own homes.
The Availability of land plays a part
In order to increase the availability of land and housing, the government has launched a brand new housing scheme called the Home Purchase Scheme, or HPS. Under this scheme, citizens can enjoy lower home prices because they can lease their plots of land, which will bring down the amount of land, and property prices.
For homeowners who wish to sell their home, there is also a new housing scheme that is supported by the government called Property Transfer on HSA, or PTHA. With this scheme, residents can transfer the ownership of their home to their spouse, and the former home owner will receive a tax deduction on his/her property.
Aside from the increase in the prices of residential properties, the CPF Housing Grant has been instrumental in the increase of the HDB Resale Market. As a result of this scheme, the home buyers and sellers are able to find more options and have better deals.
It is evident that the number of house buyers has increased, and many are able to save up more than half of their initial deposit. Moreover, the renters are also benefiting from the scheme as they have higher chances of securing a mortgage.
The Government of Singapore plans to keep the CPF Home Improvement Grant, along with the CPF Secured Loan, to help sustain the residential property market, although they cannot completely protect the system. But in the future, these schemes will be more widely used to support the thriving residential property market.