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Fewer resale HDB flat buyers paid cash-over-valuation (COV) for flats since CPF Housing Grant was enhanced
There was a "noticeable reduction" in resale HDB flat buyers who paid COV since February 2023, said Senior Minister of State for National Development Tan Kiat How.
SINGAPORE — About 18 per cent of resale Housing and Development Board (HDB) flat buyers paid higher than market rates, or cash-over-valuation (COV), for their flats since the CPF Housing Grant was enhanced in February 2023, said Senior Minister of State for National Development Tan Kiat How in Parliament on Wednesday (6 March).
This was a "noticeable reduction" in the number of resale HDB flat buyers who paid COV, decreasing from 29 per cent in 2022 and 36 per cent in 2021, Tan said. He added that the majority of resale HDB flat buyers did not have to pay any COV, and the median COV across all buyers has remained at S$0.
Tan was responding to a question by Member of Parliament (MP) for Jurong Group Representation Constituency (GRC) Xie Yao Quan, who had asked about the proportion of resale HDB flat buyers who paid COV, the mean and median COVs since the CPF housing grant was enhanced, and whether the ministry will consider making the CPF Housing Grant conditional on COVs.
Also read: Lower downpayment of 2.5% for eligible couples applying for Singapore HDB flat starting June 2024
HDB resale flat transactions are on "willing buyer-willing seller" basis
In response, Tan said that COV restrictions would be challenging to enforce, as buyers and sellers "could collude to circumvent the restrictions", given that HDB resale flat transactions are conducted on a "willing buyer-willing seller" basis, with prices negotiated and mutually agreed upon between flat sellers and buyers.
Tan added that the impact of the CPF Housing Grant on the overall HDB resale market is "limited", as the grant is targeted at first-timer families who meet income criteria and other eligibility conditions.
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