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7 New HDB Rules 2023: Grants & Flat Eligibility

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Affordability and accessibility of HDB flats have been a hot topic in Singapore over the past few years. The government has been monitoring the situation closely and has pushed out new HDB rules and regulations to address these concerns. Singapore’s Budget 2023 (14 February 2023) brought some good news for first-time homebuyers buying a resale HDB flat.

According to the Minister of National Development (MND), Desmond Lee, the new HDB regulations aim to make public housing more affordable and accessible for young families and address the concerns of the property market. The new measures will help applicants secure their first home quickly and provide more support for Singaporeans with pressing housing needs.

Currently, an applicant is considered eligible as a first-timer if they have not received any housing subsidy from HDB, including individuals who have owned private property, HDB resale flat owners who did not receive housing subsidies, and couples planning to get married.

This article will discuss what all these new HDB regulations mean for first-time flat buyers and how they will impact the property market going forward.


1. Introduction of the new First – Timer category: FT(PMC)

HDB has introduced a new priority category, coined the First-Timer (Parents and Married Couples) or FT (PMC), to provide additional support for first-timer families applying for HDB BTO and SBF exercises.

This category comprises families with Singaporean children aged 18 and below and married couples aged 40 and below buying their first home. This measure will come into effect starting from the BTO sales exercise in August 2023.

First-time families are allocated 95% of the 4-room or larger BTO flats in both mature and non-mature estates. Those eligible under the new priority category will get additional support to buy their first resale flat. It is estimated that around 10% of all first-timer families fall into this category.

From the August 2023 BTO sales exercise onwards, this new category will get greater priority among other first-timers perceived as being in less need, for example, families who own a home but have never received a housing subsidy before.

Eligibility criteria for the FT(PMC) category

To be eligible under the new priority category:

  • Families that never owned or sold a local residential private property; and
  • Families who didn’t get the opportunity to secure an HDB flat within the previous five years.

This new category excludes applicants who have previously owned or sold a private property, those who have owned a resale flat without receiving housing subsidies, and couples planning to marry soon.

Note that if you have been invited to purchase an HDB BTO flat in Singapore in the past but did not do so, you will be considered a second-timer and not qualify under this new category.

This new priority category was announced by MND in the Committee of Supply speech on 2 March 2023.

2. More balloting chances for first-timer BTO and SBF applicants

To ensure a stable property market, Desmond Lee announced another initiative during the Budget on 14 February to help first-timer families who urgently need a home.

Applicants under the first-timer priority category – first-timer families with children or married couples aged 40 and below – will be eligible for one additional ballot chance when getting their queue number for BTO and SBF flats. It means this group of applicants will get three ballot chances instead of two, as already received by other first-timer families and enjoy higher priority in BTO and SBF exercises.

With the additional ballot chance, eligible first-timer families will have a higher chance of being invited to select a flat if their desired location is oversubscribed. That could be a helpful move for those with genuine and more pressing housing needs to secure a BTO or SBF flat.

Note that this measure supports the idea that couples or families who have children right now or planning to have soon are in more urgent need of the space.

3. Increased BTO flat supply reserved for FT(PMC) applicants

Previously, under the Parenthood Priority Scheme (PPS), 30% of the BTO flat supply and 50% of SBF flats were set aside for eligible first-timer married couples. PPS has been renamed the Family and Parenthood Priority Scheme (FPPS).

From the August 2023 sales exercise, HDB will expand the existing PPS to include the FT(PMC) applicants. That means young married couples who do not have children yet will also qualify.

MND will set aside a larger flat allocation for PPS applicants to:

  • up to 40% for the BTO flats supply; and
  • up to 60% of the SBF units, in all launches in mature and non-mature estates and prime locations.

Furthermore, HDB will also give more support for FT(PMC) applicants when applying for 4-room, 3-room or 2-room BTO flats in non-mature estates with a relatively larger flat supply.

It means applicants under FT(PMC) category will be given priority for flats set aside under the PPS (or FPPS) and will have a better chance of getting a queue number for flat selection.

For example, among the 40% of flats allocated in a BTO exercise under the PPS (or FPPS), FT(PMC) applicants will receive priority in the shortlisting process compared to all other applicants under the FPPS.

4. Tighter rules for non-selection of BTO or SBF flats

Due to the long waiting time associated with the BTO process, many applicants apply for the sake of it or simply to try their luck. According to HDB, four in 10 applicants invited to book a flat upon successful balloting give up their chance to book a flat.

The reasons are diverse, but whatever the reason, it results in massive fall-outs and crowds out homebuyers who may have more urgent housing needs.

To make things right, HDB has tightened the rules on flat selection and imposed stricter penalties on couples or families who do not select a flat when invited. First-timer applicants who decline to book a flat when asked to do so will accumulate a non-selection count, down from the current two counts.

It means they will be considered second-timers in subsequent flat applications and lose their priority status for one year. Note that only around 5% of flats are set aside for second-time buyers.

The regulation takes effect from the August 2023 sales exercise onwards.


This new measure will make first-timer BTO/SBF applicants think more carefully before applying. It aims to ensure fair distribution of available BTO/SBF flats and encourage eligible applicants to take the flat selection process more seriously. The new rule will also reduce the number of people hogging the queue and clear the line for quicker BTO flat applications for real buyers.

To an extent, it forces the applicants to be less selective and pick a unit or risk their future eligibility. It will help HDB reduce the rejection rate for BTO flat selection exercises and ensure more efficient allocation.

However, HDB understands that certain situations call for flexibility. Therefore, there are some exceptions to this rule. Applicants with limited options (generally those at the back of the queue) will have the penalty for non-selection waived.

For example, if you have 10 or fewer BTO flats or five or fewer SBF flats, HDB may waive the non-selection count in case of extenuating circumstances.

Some property analysts expect that the number of BTO flat applicants could temporarily decrease from the August 2023 BTO launch onwards due to the change in rules.

5. Ramping up the supply of public & private residential properties

Around 100,000 homes in private and public housing markets are expected to be completed and launched between 2023 and 2025. This year almost 40,000 of these private and public homes will get completed. It is the highest in the last five years, including the pre-Covid-19 years of 2018 and 2019.

The increasing supply of residential properties will reduce some pressure in the rental market by enabling those waiting for their keys to move into their own homes, thus reducing rental demand. The new homes will also contribute to the expansion of the rental supply.

Several factors, such as long waiting times and delays in the BTO flats construction since the COVID-19 pandemic have resulted in the tight housing supply and rising resale prices in the past few years. Acknowledging these concerns, HDB has planned to ramp up the supply of BTO flats.

Around 23,000 BTO flats are scheduled for launch this year, mirroring the quantity released in 2022 to meet the supply crunch and address the robust demand in the property market.

That represents a growth of over 35% compared to the 17,000 flats launched in 2021 and an increase of over 50% compared to the pre-Covid-19 pandemic figure of 15,000 flats in 2019.

But the best part is that the BTO flat prices have been kept “almost flat” despite rising construction costs and strong demand in the past two years.

In the public segment, HDB is building aggressively and on a large scale. Almost 100 BTO projects are currently under construction throughout Singapore. By 2025, the number of concurrent BTO projects will reach more than 150.

From 2024 onwards, HDB has planned to increase the proportion of BTO flats with shorter waiting times (under three years) as part of the new flats supply.

6. Higher housing grants to make resale flats more affordable

Young Singaporean couples who wish to start families are held back by prolonged waiting times for BTO flats and soaring prices in the HDB resale market.

To address these concerns, Deputy Prime Minister Lawrence Wong announced that the government increased the CPF housing grants to provide more support to first-timer families buying resale HDB flats and help them ease some of their financial burdens.

The revised CPF housing grants are applicable for resale HDB flat applications starting from 14 February 2023.

For 2- to 4-room resale flats

Eligible first-timer families can now get CPF housing grants up to $80,000. Previously, the cap on the grant amount was $50,000.

For 5-room or larger resale flats

Eligible first-timer families can now get $10,000 more in CPF housing grants. That brings the grant amount to $50,000.

On top of the Enhanced Housing Grant (EHG) and the Proximity Housing Grant (PHG), this raises the maximum possible grant amount for HDB resale flats to $190,000, up from a previous cap of $160,000.

Those who submitted resale applications on or after 1 April 2023 qualify for the increased housing grant.

Increased housing grants for first-timer singles too!

In addition to first-timer families, eligible first-timer singles buying HDB resale flats will receive a higher CPF housing grant.

For 2- to 4-room resale flats, first-timer singles can receive housing grants up to $40,000. Previously, the grant amount was $25,000.

For 5-room or larger resale flats, first-timer singles can now receive housing grants up to $25,000, up from $20,000.

Eligibility for the increased CPF housing grant

To be eligible for the grant, first-timer couples or families must fulfil the usual eligibility requirements, such as:

i) At least one spouse must be a Singapore Citizen (SC);

ii) Monthly household income should not be more than $14,000;

iii) Must not have owned or had an interest in a private property in the last 30 months before the flat application.

For grant eligibility, first-timer singles must follow this criterion:

i) Singapore Citizen aged 35 or above

ii) Monthly income should not be more than $7,000;

iii) Must not have owned or had an interest in a private property in the last 30 months before the flat application.

7. Introduction of the new HDB Flat Eligibility Letter (HFE)

From 9 May 2023 onwards, HDB has implemented a new application process for flat purchases, which involves issuing a new document called the HDB Flat Eligibility (HFE) letter. The HFE letter replaced the existing HDB Loan Eligibility (HLE) letter.

The HFE letter will provide prospective homebuyers with a comprehensive outline of their housing and financing choices before starting the homeownership journey. Whether one intends to purchase a BTO flat, HDB resale flat, SBF unit, or Open Booking of Flats (OBF) unit, submitting an HFE letter with the application is mandatory.

Previously, homebuyers would need to apply for an HLE letter after successfully balloting for a BTO flat to check whether they qualify for an HDB loan.

The new HFE letter streamlines the home buying process by assessing their eligibility for flat purchase, MSR calculations, CPF housing grants and HDB housing loans – all into one application.

The HFE letter must be obtained:

  • before balloting for flats during a new sales launched
  • before applying for resale flats

The HFE letter is mandatory for all new flat applications from the May 2023 sales exercise onwards.

Read more about a HDB loan vs a bank loan and which is better so that you can be informed on which options suits your needs best.

How to apply for an HFE Letter?

The HFE letter application process consists of two steps:

Step 1: Preliminary HFE check

In this step, you must fill in the applicant’s personal information and income details, make declarations, and choose whether you intend to take up an HDB housing loan.

It provides a preliminary assessment of your household’s eligibility for housing grants and HDB home loans. Based on the information provided, you will get an instant result.

Step 2: Apply for an HFE letter

Within 30 calendar days of starting the preliminary HFE check, you must apply for an HFE letter through the HDB flat portal.

You need to indicate whether you want a home loan to buy a flat, and if yes, whether you intend to take a HDB bank loan or a loan from HDB to make the flat purchase.

Final Thoughts

If you are a prospective first-time homeowner in Singapore, keen on purchasing an HDB BTO or resale flat, ensure you capitalize on the advantages offered by the latest measures when submitting your HDB application.

With the much-needed help in the form of additional CPF housing grants, more first-timers may turn to the resale market for their housing needs. The government is also ramping up the supply of public and private flats and reducing the waiting time.

The introduction of an HFE letter for buying an HDB home will streamline the home-buying process into one application. These measures will mitigate some of the housing concerns that first-time buyers have been experiencing in recent years.

Overall, this year’s budget announcement can be seen as a small win for homebuyers. If you are confused about whether you should go for an HDB loan or a bank loan for your flat purchase, you can reach out to our friendly team of mortgage consultants at Dollarback Mortgage.

Our competitive team of talented professionals can help you find the best home loan mortgage deals on the market and advice you on simplifying your home ownership journey – all at no cost!

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