Resale HDB flats. Is it now a good time for PRs (permanent residents) to buy?

6 min read

resale HDB flats PRs buy

Now is the time for PRs (permanent residents) to think of resale HDB flats. For PRs (permanent residents), most of the time, the answer is “as soon as you can”. That’s not just because prices have been falling – although that helps – it’s because renting and limited availability (of location) are constant problems that need to be resolved fast. Here’s why you shouldn’t play the waiting game for too long:

First, a quick clarification on buying HDB flats for PRs

For the Single Singapore Citizen Scheme: In order to buy an HDB resale flat as a single, you must be at least 35 years old if you are unmarried or divorced, and at least 21 years old if you are widowed or an orphan.

Why resale HDB? Because many PRs can’t get a Built to Order (BTO) or new flat anyway. If you’re not clear on the rules, here’s what you need to know for PRs:

First, you are only eligible to buy a BTO flat if your spouse is a Singapore citizen. It’s not possible for two PRs to buy a new flat – your only options are a resale HDB flat, or private property (condos, landed property, etc.)

Second, you need to have been in Singapore for at least three years. This applies to both you and your spouse. So if you have been in Singapore for five years, but your spouse has been in Singapore for only a year, you will have to wait another two more years.

Third, a single PR cannot buy a HDB flat (including resale flats.)

Assuming you are in a position to buy, there are plenty of reasons to get a resale HDB flat as soon as you can

The current rules leave many PR-only couples with the choice between expensive private housing (e.g. condos and landed property), resale HDB flats, or renting. There are many reasons a resale flat can top those options, especially now:

  • Resale HDB flats are in demand and are snapped up fast
  • Renting is a gigantic waste of money
  • Rising interest rates mean it’s time to emphasize affordability

Resale HDB flats are in demand and are snapped up fast

We mentioned before that resale flats are growing in popularity. In fact, throughout 2015, resale flat prices only fell by around 1.5 per cent as a whole, whereas landed property prices fell by a hefty 3.7 per cent.

We feel this will almost always be the case, as resale HDB flats combine three integral factors:

First, it is the only type of flat that PRs-only couples can buy; sandwiched between renting or more expensive private property, this is the best option available to the growing segment of PRs. The demand for resale HDB flats rarely sees a significant decline.

Second, many resale flats are located in mature districts. They are in places where local amenities, from malls to MRT stations, are already constructed. Even if you could get a BTO flat (e.g. your spouse is a Singapore citizen), newer flats tend to be in less developed districts.

Third, resale HDB flats are generally bigger than newer flats. For bigger families, this is the most room they’ll get without turning to bigger and more expensive private properties.

The consistent demand for resale flats means they are snapped up fast – even in the midst of a property market slump, most buyers can expect a bit of competition. The current market thus presents a surprising opportunity; some have chosen to risk waiting (in the hopes prices will fall further), but this creates an opening to get a resale flat – for a good price to boot – in an ideal location.

We’d suggest you take advantage of the discount-hungry, and take a serious look at the current resale flat market while they dawdle. We can’t stress enough that it is very hard to get the location you want, in a property market as expensive and crowded as Singapore’s.

Renting is a gigantic waste of money

There are PRs who rent, which is understandable if they are single or waiting for their mandatory three years. But there is a subset that rents because they can’t afford a condo, but at the same time don’t want to buy a resale flat (perhaps it’s because they’re saving up for said condo.)

Renting is generally inadvisable, if a resale HDB flat is within your reach. The money spent on rent is simply wasted. Three to five years of renting later, you have nothing to show for it.

In addition, the rising interest rates on home loans means that landlords are eventually going to hike rates. We note that HDB rental rates were already up by 0.7 per cent last January, despite constant complaints of a softening rental market. Nonetheless, with the Federal rate hike set to rise in slow and steady of increments, landlords have more costs to push onto tenants in the coming years.

For those PRs who can get their hands on a BTO flat, this is also a factor

A BTO flat requires two to three years of wait time in general. A resale flat is already built, and it’s possible to move in after a little over a month. If you don’t have a place to stay, it is worth seriously considering a resale unit instead of paying rent for three years.

Rising interest rates mean it’s time to emphasize affordability

We recently saw an 80 per cent increase in the number of foreclosed properties, between 2014 and 2015. Most of these were larger landed properties.

The essential lesson here is one of affordability – many of these properties had manageable mortgage rates, back in the days when home loan rates reached as low as 1.7 per cent and refinancing was easy. With the introduction of interest rate hikes, that time is at an end.

Historical interest rates for home loans in Singapore are 3.7 per cent, almost twice as high as they’ve been between 2008 and 2014. Part of the reason for cooling measures such as the Total Debt Servicing Ratio (TDSR) is to brace home owners for the possibility of a sharp spike in interest rates.

An ideal home for your wallet should not exceed five times your household income. And while the TDSR limits your loans to 60 per cent of your monthly income, we’d venture that 50 per cent is a much safer ratio (this will account for changes in interest rates.)

Declining home prices might tempt you into getting a more expensive condo – but if the mortgage would be barely tolerable, it might be safer to settle for a cheaper resale flat. Remember: it will almost certainly rise in the coming years.

You can browse some of the best resale flat listings in Singapore on 99.co.

Looking for a property?

Find the home of your dreams today on Singapore’s fastest-growing property portal 99.co! If you would like to estimate the potential value of your property, check out 99.co’s Property Value Tool for free. Also, don’t forget to join our Facebook community page or Telegram chat group! Meanwhile, if you have an interesting property-related story to share with us, drop us a message here — and we’ll review it and get back to you.

Reader Interactions

Comments

    • Sunshine

      I single Mother pr n I got kids under my custody how I can buy resal flatt?

      • Adam R.

        Hi Sunshine,

        Apologies, but as a single PR, you will not be eligible to purchase a HDB flat. Afraid the only other option is to rent.

        Regards,
        Adam R.

    • Raymond

      Can a single (PR) mother (divorced) combine with her daughter (16 yrs) and sons purchase a resale HDB flat ?

      • Adam R.

        Hi Raymond,

        Unfortunately, a single PR mother cannot combine with her 16-year old daughter and/or sons to purchase a resale flat if they are below 21 years of age. In addition, they must be Singapore citizens to apply.

        For more info, you can view the conditions for eligibility here: https://services2.hdb.gov.sg/webapp/BP13EligCheck/BP13SHome?strSystem=CHECK

        Regards,
        Adam R.

    • Haroon

      Hi,
      I’m a new PR and my spouse is Singaporean.
      What type of house I can apply under HDB?

      • Adam R.

        Hi Haroon,

        Both you and your spouse qualifies for both BTOs and resale flats as long as your combined income is below $12K.

        Regards,
        Adam R.

    • Chea phoay seng

      I am pr more than 5 years…my wife got a pr ..staying in msia …can i buy hdb flat after 3years …if she is not staying in spore during this 3 years?

      • Krristy Lam

        Dear Phoay Seng,

        Your wife needs to stay in Singapore for 3 years in order for both of you to be eligible.

        Cheers,
        Krristy

    • Adarsh

      “Second, you need to have been in Singapore for at least three years. This applies to both you and your spouse. So if you have been in Singapore for five years, but your spouse has been in Singapore for only a year, you will have to wait another two more years.”

      What is meant by this? Need to stay in Singapore for 3 years after obtaining PR or staying in Singapore with other passes make you eligible soon after you get your PR?

      • Krristy Lam

        Dear Adarsh,

        Both you and your spouse have to be PR, and both of you must have stayed in Singapore for at least three years in order to be eligible.

        Thank you!
        Krristy

    • Yossy

      Thank you for the valuable information. Can a single PR parent and PR child buy resale HDB? Please refer to gov. website. http://www.hdb.gov.sg/cs/infoweb/residential/buying-a-flat/resale/eligibility-schemes

      • Krristy Lam

        Hi Yossy,

        Yes, a single PR parent can buy a resale HDB provided certain requirements have been reached. This includes staying in Singapore for at least three years, and that the resale flat you are looking at satisfies the Ethnic Integration Policy and SPR Quota. You can check out the EIP and SPR quota here:

        https://services2.hdb.gov.sg/webapp/BB29ETHN/BB29STREET

        Good luck!

        Cheers,
        Krristy

    • Ong

      I recently got PR. How long have to wait to buy resale HDB? Is the 3 years requirement true?

      • Krristy Lam

        Hi Ong,

        Yes, the three years requirement is true.

        Thank you for reading the article!

        Cheers,
        Krristy

    • Quinne

      Both my spouse and I have been staying in SG for more than 8 years. My spouse has been a PR for 3 years already, but my PR was obtained 2 years ago. Are we eligible to buy resale HDB now? Or must we wait till I have been a PR for 3 years?

      • Krristy Lam

        Hi Quinne,

        Yes indeed, you are right to say that you will have to wait till you have been a PR for three years.

        Cheers,
        Krristy

    • Louis

      Can 2 PRs (Husband and Wife) buy HDB flats?

    • Teik Haur

      Hi, both my spouse and I have been staying in Singapore more than 7 years. I have been a PR for 5 years, and my spouse’s PR was 10 months only. Are we eligible to buy resale HDB now? Or both of our PR must be at least obtained 3 years and above? Can you provide more informations guide about these matter?

    • Krristy Lam

      Hi Teik,

      Both you and your spouse need to have PR status for at least three years.

      You can get more information from the article below:

      https://www.99.co/blog/singapore/property-purchase-prs-singapore/

      Regards,
      Krristy

    • anqi

      hi, me and spouse are PR, what if we divorce? can either one of us retained the hdb? we have a 5 yrs old son – also PR

      • Krristy Lam

        Hi Anqi,

        Whoever gets custody of the child will retain ownership of the HDB flat.

        Regards,
        Krristy

    • LeeYC

      Hi, my wife and me are both PR for 5 years. But she stay less than 2 years in Singapore. Are we eligible to apply for a re-sale HDB ? I have 3 kids still studying in school but not staying in Singapore currently.
      Thank you.

      Regards
      LeeYC

      • Qihan Ng

        Hi YC,

        Since you and your wife have satisfied the three year benchmark as PRs, you are eligible to apply for a resale HDB.

        Regards,
        Qihan

    • Hanice

      I’m a SPR for more than 5 years but i’m also a divorcee. My child is staying with his dad. Can I buy a HDB on my own? Resale flat? I’m in my early 40s.

    • swee teng

      hi if my husband is singaporean but im pr for only a year, can we buy resale flat?

    • Cindy Poh

      hi may i know I & my uncle (mother brother) both of us is single PR, can we combine name to buy re-sale HBB or condo?

    • Ann

      I am single and over 35 years old, have been a PR and live in Singapore for more than 5 years. Can I buy resale HDB?

Leave a comment

Your email address will not be published. Required fields are marked *

Get the latest news in your inbox

  • This field is for validation purposes and should be left unchanged.