A higher income ceiling to qualify for new HDB flats will be good news for 1st-time home buyers. This is according to ppty analysts who said that the move will also benefit the sandwiched class most. Early this week, National Development Minister Mah Bow Tan hinted that the income ceiling for new BTO flats could be raised to S$10,000 after the GE. Analysts have welcomed the plans to raise the income ceiling for new HDB flats which has been S$8,000. Should the new income ceiling be in place, 1st-time home buyers who earn over S$8,000 but less than S$10,000 will be allowed to book BTO flats. At the moment, they can only buy flats under the DBSS, ECs, from the resale market and also buy private apts. BTO flats, which are between S$300,000 and about S$500,000, are said to be the most affordable housing in S’pore. Their prices are lower compared to DBSS flats - ranging from S$500,000 to S$750,000 - and ECs - at between S$750,000 and S$950,000. Analysts said the higher income ceiling for new flats is not likely to have a significant impact on the overall ppty market, given that the sandwiched class is only a small part of the ppty market. But some said the resale HDB market could still be marginally hit.
Some analysts said they do not see any immediate impact of the move on the ppty prices in the HDB resale market, saying that there is an 8-year gap before any of the BTO flats become eligible for resale. This year, the HDB is looking to build around 22,000 flats under the BTO scheme - the largest supply in recent years. National Development Minister Mah had said that the review of the income ceiling is likely to be conducted after the GE and will be completed within 6 months.
Source By - CNA posted May 8, 2011
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