Paper 2 · HDB Policies
CPF Housing Grants & the HDB Resale Process
Two practical topics close out the HDB rulebook: the grants that make a flat affordable, and the resale process — which runs very differently from a private sale.
CPF housing grants
Eligible buyers — especially first-timers — can receive CPF housing grants to offset the purchase price, subject to income ceilings and citizenship. First-timers receive far more than second-timers. Current (2026) headline amounts:
| Grant | Who it's for | Amount (2026) | Income ceiling |
|---|---|---|---|
| Enhanced CPF Housing Grant (EHG) | First-timer families — BTO or resale | Up to $120,000, scaled to income (max at ≤ $1,500/mth) | $9,000/mth |
| EHG (Singles) | First-timer singles, 35+ | Up to $60,000 | $4,500/mth |
| CPF Housing (Family) Grant | First-timer families buying resale | $80,000 (2–4 rm) · $50,000 (5 rm+) | $14,000 ($21,000 extended family) |
| Singles Grant (resale) | Eligible single citizens, 35+ | Up to $40,000 (half the family grant) | $14,000 |
| Proximity Housing Grant (PHG) | Living near / with parents or children | $20,000 within 4 km · $30,000 living together (singles: half) | None |
| Step-Up Housing Grant | Second-timers upgrading from a smaller subsidised flat | Up to $15,000 | $7,000 |
Grants stack. A first-timer SC + SC couple buying a resale flat near their parents can combine EHG ($120k) + Family Grant ($80k) + PHG ($30k) = up to $230,000 off the price. A first-timer + second-timer couple has the EHG and Family Grant halved; two second-timers get neither (they may only qualify for the Step-Up grant).
The resale process
- The buyer first obtains an HDB Flat Eligibility (HFE) letter — confirming eligibility, the grants they qualify for and loan options before committing (required since 2023).
- Both parties register an Intent to Buy/Sell on the HDB Resale Portal.
- Seller grants an HDB OTP; a Request for Value anchors the valuation.
- Buyer exercises the OTP, then both submit the resale application; HDB approves and the sale completes (~8 weeks).
HDB OTP vs private OTP
| HDB resale OTP | Private resale OTP | |
|---|---|---|
| Option fee | Negotiable, up to $1,000 | Typically 1% of price |
| Exercise / deposit | Option + exercise fee, total up to $5,000 | Top up to 5% on exercise |
| Option period | 21 days | Commonly 14 days |
| Process | Via HDB Resale Portal + HDB approval | Via lawyers; no HDB approval |
Worked example
A first-timer couple buying a resale flat may qualify for the EHG (scaled to their income) plus a Family Grant and possibly the PHG for living near parents — materially cutting the cash/loan needed. On the OTP: they pay the seller an option fee (say $1–$1,000), then on exercise top up so the option + exercise fee total ≤ $5,000 — nothing like the private 1%/5%.
Second-timers & the resale levy
A second-timer who already enjoyed a housing subsidy (a previous BTO or grant) generally pays a resale levy when taking a second subsidised flat. It claws back part of the first subsidy and is recovered from the first flat's sale proceeds (or paid on the new purchase). Second-timers also receive smaller or no grants than first-timers — and first-timers pay no levy at all.
CPF, accrued interest & financing
CPF Ordinary Account savings can fund the downpayment, purchase price and monthly instalments (subject to limits). But on a future sale, the CPF used plus accrued interest must be refunded to your CPF — so the cash you actually pocket is less than the headline price. Financing is either an HDB concessionary loan (eligibility-based, pegged to CPF OA + 0.1%) or a bank loan (market rate, subject to MSR/TDSR).
Common mistakes
- Applying the private 1%/5% deposit logic to an HDB resale OTP.
- Assuming second-timers get the same grants as first-timers (they get less).
- Overlooking income ceilings on grant eligibility.
- Forgetting HDB resale needs HDB approval to complete.
The trap
Assuming the HDB OTP works like a private OTP. It doesn't — HDB caps the option fee (up to $1,000) and total deposit (up to $5,000), runs a 21-day option period, and needs HDB approval — none of the private 1%/5% mechanics.
Exam takeaway
Match the process to the property: HDB resale = portal + HDB OTP (≤$1k option, ≤$5k total, 21 days, HDB approval); private resale = 1%/5% OTP via lawyers. And grants (EHG/Family/PHG) favour first-timers.
Apply it · the IRAC method
A young couple, both first-time buyers with a modest combined household income, are buying a resale HDB flat and ask what CPF housing grants they may qualify for and how long the resale purchase will take from Option to completion.
- IIssue: What CPF housing grant may the couple be eligible for as first-timer resale buyers, and what is the broad HDB resale process and timeline?
- RRule: First-timer families buying a resale flat may qualify for CPF housing grants such as the Enhanced CPF Housing Grant (EHG), subject to eligibility conditions including a household income ceiling and other criteria; grant amounts are tiered by income. The HDB resale process runs from granting the Option to Purchase (OTP), exercising the OTP, submitting the resale application to HDB, HDB's approval, to completion. Confirm current grant amounts, income ceilings and processing timelines with CPF Board / HDB.
- AApplication: As first-time buyers with a modest income, the couple may be eligible for the EHG, with the exact amount depending on their assessed household income and other conditions. Their transaction will follow the standard OTP → exercise → resale application → HDB approval → completion sequence, which HDB indicates takes a number of weeks once a complete application is submitted.
- CConclusion: Advise the couple that they likely fall within EHG eligibility but should confirm the exact grant amount, income ceiling and current processing timeline directly with HDB / CPF Board, and plan their finances around the full resale timeline to completion.
Worked case study · Section B style
An eligible first-timer couple buy a resale flat with a CPF Housing Grant and use CPF savings for part of the price. • First-timers • Using CPF + a grant
- (i) Eligible first-timers can receive CPF housing grants towards a resale flat
- (ii) Grants are subject to income ceilings and other conditions
- (iii) On a future sale, the CPF used (plus accrued interest) must be refunded to CPF
- (iv) The grant is paid out in cash for the couple to spend freely
- A.(i), (ii) and (iii) only
- B.(i) and (iv) only
- C.(iii) only
- D.All of the above
Show answer & explanation
Answer: A. (i)–(iii) are correct: income-tested grants, and CPF must be refunded with accrued interest on a sale. (iv) is the trap — the grant goes into the purchase, not free cash.
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Practise HDB Policies questions →Common questions
- Who qualifies for CPF housing grants?
- Eligibility depends on factors such as first-timer status, citizenship and household income ceilings. First-timers generally receive more than second-timers, and amounts are revised by the government from time to time.
- Is the HDB option to purchase the same as a private OTP?
- No. HDB resale uses its own option-to-purchase form and process through the HDB Resale Portal, with different option fee and timing rules from a private property OTP.
- What is the HDB Flat Eligibility (HFE) letter?
- Since 2023, buyers must obtain an HFE letter from HDB before committing to a flat. It confirms your eligibility to buy, the housing grants you qualify for, and your loan options upfront — so you know your budget before exercising an OTP.
- Do second-timer buyers pay a resale levy?
- Generally yes. A buyer who previously enjoyed a housing subsidy pays a resale levy when buying a second subsidised flat, and receives smaller or no grants. First-timers do not pay a resale levy.
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