Back in 2019, the government announced the then-new Enhanced CPF Housing Grant, which offered first-timer families up to S$80,000 to buy a HDB flat.
At that time, property analysts and homeowners looking to cash out expected the grant to buoy the resale flat market.
At least property agent went on public record, saying that a family he was representing sought S$70,000 for their 5-room HDB flat after the grant was announced.
And between 2019 to 2022, the prices of HDB flats skyrocketed.
In his Budget 2023 speech yesterday, Deputy Prime Minister and Finance Minister Lawrence Wong announced a new trench of grants of up to S$30,000 in additional grants for families buying resale flats for the first time.
This has gotten many worried that instead of making HDB flats more affordable, the government might have made matters worse for young families seeking a home.
Already, property analysts are speculating that because supply of public housing is tight, sellers will raise their asking price knowing that buyers have received additional funds.
As a result, the very people the grants are meant to help might simply get priced out of the market.
Besides that, the housing grant must be paid back in full to one’s CPF, with accrued interest, if the homeowner sells the flat.
This is likely to drive prices even higher later down the road, as homeowners seek more liquid cash to buy alternative homes.
Singaporeans have been wondering if the new grants are another way of the government kicking the can down the road when it comes to the affordability of public housing.
Especially, when it seems reluctant to or unable to build enough flats to keep up with demand.
Some have asked how come the government can build bigger airports and ports to plan decades ahead, but lacks this same conviction when it comes to homing Singaporeans.
Many have asked whether future Singaporeans will have to bear even bigger tax burdens, in addition to exorbitant housing prices, in the coming years.