Mass-market developers to suffer on back of higher HDB, EC income ceiling

Public housing will be more affordable to the middle class.

This year’s National Day Parade (NDP) brought a pleasant surprise for middle-income families longing for their own public flat.

Prime Minister Lee Hsien Loong revealed on Sunday that the income ceiling for HDB flats has been raised from $10,000 to $12,000, while that of executive condominiums (ECs) has been increased from $12,000 to $14,000.

In addition, the household income ceiling for the existing Special CPF Housing Grant will also be raised to $8,500.
Although this move is good news for middle-income earners, OCBC analysts warn that the increased affordability of public housing might negatively impact the already struggling mass-market private property segment.

“This is expected to cover two-thirds of all Singapore households. Given the government’s push to improve the affordability of housing for the middle-income group, we believe there may be some impact on the private mass market segment,” OCBC said.

Other initiatives that were unveiled at this year’s NDP Rally include the implementation of a Fresh Start Housing Scheme to help second-timer rental households own a two-room flat, as well as a Proximity Housing Grant to help couples who are looking to buy a resale flat with or near their parents, or for parents who wish to live near their married children.