Property Jargon of the Day: Flexi-Flats

Every day, 99.co picks a piece of property jargon to explain it. Today we look at flexi-flats. Here’s how it works:

What are flexi-flats?

Flexi flats fall under the HDB two-room Flexi Scheme. First- and second- timer families, together with first-timer singles, can buy new two-room flats on a 99-year lease. In contrast, senior citizens have the flexibility to either purchase a 99-year or short lease. For Singaporeans aged 55 and above, they can take up short leases between 15 and 45 years, in five-year increments. However, they have to ensure that the lease covers either spouse up to the age of at least 95 years.

What are the eligibility conditions?

You have to meet the following conditions to purchase a flexi-flat. The conditions may differ for a flexi-flat on 99-year and short lease.

For both 99-year and short lease

You need to be under one of the eligible schemes:

• Public Scheme
• Fiancé/Fiancée Scheme
• Orphans Scheme
• Single Singapore Citizen Scheme
• Non-Citizen Spouse Scheme
• Joint Singles Scheme

There has to be at least one Singapore Citizen applicant. There are also more requirements for some schemes:

• Public, Fiancé/Fiancée & Orphans Scheme: At least one Singapore Citizen or Singapore Permanent Resident
• Non-Citizen Spouse Scheme: Spouse is neither a Singapore Citizen or Singapore Permanent Resident
• Joint Singles Scheme: All applicants (maximum of four) must be Singapore Citizens

For 99-year lease

Age

You must be at least 21 years-old for the Public, Fiancé/Fiancée & Orphans Scheme. For Single Singapore Citizen, Non-Citizen Spouse and Joint Singles schemes, you have to be at least 35 years-old.

Income Ceiling

Your average gross monthly household income cannot exceed $6,000.

Property Ownership

Ensure that you do not own other overseas or local properties and have not disposed of any within the last 30 months. Moreover, you are only allowed to have purchased only one of those properties or received one CPF Housing Grant thus far.

For Short Lease

Age

All buyers must be at least 55 years-old at the time of flat application. The allowable lease period will be based on the youngest applicant at the time of flat application. You need to ensure the chosen lease must be able to last all buyers until at least the age of 95. The selection of lease period will be made during the flat selection.

Income Ceiling

Your average gross monthly household income cannot exceed $12,000.

Property Ownership

If you or anyone listed in your flat application owns a local or overseas private property, you must dispose all of them within six months from the date of taking possession of the two-room flexi-flat.

Periods to look out for:

• MOP
• Previous cancellation of flat application
• Divorcee status

There are instances where you need to wait before you can apply or be listed in the application for a new flat.

1. Minimum Occupation Period (MOP) of a current flat/ EC unit

You need to check if you or any other flat applicant(s) and essential occupier(s) to be listed in the flat application own any of these:

1. HDB flat bought from HDB or on an open market
2. EC unit/ DBSS flat bought from the developer

Potential applicants must have already met that flat/ EC’s MOP before they can apply for a new flat. Same goes for an essential occupier before he can be listed in a new flat application. However for ECs, you must wait out a 30-month period from the EC’s effective date of disposal.

2. Has previously cancelled a flat application

If you have booked a flat and eventually cancelled your booking, you must fulfill a one year wait-out from the date of the cancellation. Only then can you apply or be listed as an essential occupier of a:

• New HDB flat
• DBSS flat or EC bought from a developer
• Resale flat bought using a CPF Housing Grant
• Resale flat announced for SERS

However, if you do not book a flat after being invited to do so for two consecutive times, you have to wait one year from the date of the second non-selection to participate in the sales launch.

3. Divorcee

Take note of these conditions for any of these types of property:

1. Flat bought from HDB
2. Resale flat bought with a CPF Housing Grant
3. DBSS flat/ EC bought from the developer

There is a three-year wait-out period* whereby only one divorce party can apply and  own any of the above properties. However, if any of the above properties was the matrimonial home and is currently owned by your ex-spouse, you must wait for three years before you can buy or be listed as an essential occupier. Check out the HDB website for exceptions.

*It will not apply for flat applications received from May 2018 sales launches.

Additional things to note:

• Mortgage Financing
• CPF Savings
• Past or Current Ownership to an HDB Flat, DBSS Flat or EC

1. Mortgage Financing

You can opt for an HDB or a bank loan for a 99-year flexi flat. In contrast, you will have to pay with cash or CPF savings or both for a short-lease flexi flat.

2. CPF Savings

You can use the excess CPF savings in your Ordinary Account (OA) and Retirement Account (RA) to purchase a two-room flexi-flat if you are 55 years-old and above and have set aside the Basic Retirement Sum.

3. Past or Current Ownership to an HDB Flat, DBSS Flat or EC

For 99-year lease

You can apply for a two-room Flexi flat provided you only own/owned one of the following units:

1. Flat bought from HDB
2. EC/DBSS flat bought from the developer
3. HDB resale flat bought using a CPF Housing Grant (for first-timer applicants)

For short-lease

If you own or have a share in an HDB flat, you are able to apply for a short-lease two-room flexi-flat. You can also be listed as an occupier in a short-lease two-room flexi-flat application.

However, you must dispose of your private property within six months of getting your flexi-flat. Also, you should not have purchased a Studio Apartment or short-lease two-room flexi-flat previously.

Should You Consider a flexi-flat?

Short lease flexi-flats are usually meant for elderly Singaporeans. However, they can also be helpful to Singaporeans who are on a tight budget, or who are lifelong singles and prefer to invest the savings elsewhere.

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