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What should I look out for when buying a house above 55 years old?



As Singapore citizens and permanent residents reach the age of 55, they are eligible to withdraw their CPF savings in the form of cash or use it to purchase a house. This is known as the CPF Retirement Sum Scheme. For those who are looking to purchase a house, they can use their CPF savings to make the down payment and pay the monthly instalments. However, there are certain rules and limitations that need to be taken into consideration before making a purchase.


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Firstly, the house must be a HDB flat or a private property that is approved for CPF housing grants. The property must also be located in Singapore and be intended for the individual's own occupation.
Secondly, the individual must have met the Minimum Sum requirement for their age. The Minimum Sum is the amount that CPF members are required to set aside in their CPF accounts to provide for their retirement. This amount varies depending on the individual's age, and can be found on the CPF website. The Minimum Sum is reviewed every year and is announced in the Budget Statement.
Thirdly, the property's purchase price or market value, whichever is lower, must not exceed the Valuation Limit. The Valuation Limit is the maximum value of a property that can be financed with CPF savings, and is subject to change. As of 2021, the Valuation Limit for HDB flats is $1 million, while the limit for private properties is $1.5 million.


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Lastly, the individual must also have enough savings in their CPF Ordinary Account (OA) and Special Account (SA) to pay for the down payment and the monthly instalments. If the individual does not have enough savings in their OA and SA, they will have to top up their accounts before making a purchase.
For those who are 55 years old and above, their CPF savings will be transferred to the Retirement Account (RA). The RA is a special account that is set up to provide for an individual's retirement needs, and the funds in the RA cannot be used for any other purpose except for housing, insurance, and investment plans approved by CPF Board.



However, if an individual above 55 years old is unable to purchase a flat due to their age, they have the option of selling the flat back to the Housing Development Board (HDB) under the Lease Buyback Scheme. The Lease Buyback Scheme allows eligible senior citizens to sell a portion of their flat's remaining lease to HDB in return for a lifelong stream of rental income. This allows them to continue living in their flat while having additional income to supplement their retirement savings.
To be eligible for the Lease Buyback Scheme, the following criteria must be met:

  • The flat must be a HDB flat that is fully paid up and located in Singapore.

  • The owner(s) must be at least 55 years old and the youngest owner must not be more than 70 years old.

  • The owner(s) must have lived in the flat for at least the past 5 years.

  • The owner(s) must not own any other property.

  • The remaining lease of the flat must be at least 20 years.


The amount of lease that can be sold back to HDB will depend on the owner's age, the remaining lease of the flat and the market value of the flat. The amount of rental income received will also depend on the amount of lease sold and the prevailing interest rate.



Here is a general overview of the buying process for a HDB flat:
  1. Eligibility: The first step in the process is to check if you are eligible to buy a HDB flat. You will need to meet the eligibility criteria set by the HDB, which includes citizenship, age, income, and family nucleus.

  2. Choose a flat type: Once you have determined your eligibility, you can choose the type of flat that best suits your needs. HDB offers various types of flats such as 2-room Flexi, 3-room, 4-room, 5-room, and Executive flats.

  3. Application: You can apply for a flat through the HDB's e-Service portal or at any of the HDB branches. You will need to submit the necessary documents and pay the application fee.

  4. Balloting: After your application is processed, you will be notified if you are successful in the balloting process. The flats are allocated through a computerized balloting system and the allocation is based on factors such as the flat type, location, and the applicant's priority status.

  5. Signing of the Agreement for Lease: Once you are allocated a flat, you will need to sign the Agreement for Lease (AFL) within the stipulated time frame. The AFL is a legal document that binds you to buy the flat and outlines the terms and conditions of the sale.

  6. Paying the down payment: After signing the AFL, you will need to pay the down payment for the flat. The down payment can be made using cash, CPF savings, or a combination of both.

  7. Completion of the sale: After the down payment is made, the sale is completed and the keys to the flat will be handed over to you. You will need to pay the remaining balance of the purchase price and the stamp duty within the stipulated time frame.

  8. Renovation and moving in: Once you have received the keys to the flat, you can begin the process of renovating and moving in. It is important to note that there are certain rules and regulations that must be followed when renovating a HDB flat.

It is important to note that the buying process may vary depending on the type of flat you are applying for and the specific regulations in place during the time of the purchase. It is advisable to consult the HDB website or me more for more information on the process and guidelines.

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