More first-time homeowners turning to resale market

More first-time owners are turning to the resale market to meet their housing needs, said the Senior Minister of State for National Development Grace Fu.

Replying to a question from MP for Sembawang GRC Lee Wee Kiak in Parliament on Monday, Ms Fu said that in the second quarter of this year, there were 1,470 cases of first-timer flat buyers buying resale flats using the CPF Housing Grant.

This is a 75 per cent increase compared to the average of about 840 cases per quarter from the third quarter of 2007 to the first quarter of this year.

However she also assured the House that first-time flat applicants for public housing are getting more chances under the Balloting Scheme for build-to-order flats.

Tighter rules introduced in May this year on the number of times couples can reject a unit have also resulted in more considered applications and higher acceptance rates.

Still on the housing issue, Parliamentary Secretary for National Development Mohamad Maliki Osman said some low income families are better off owning rather than renting their home.

For example, a family earning S$1,000 a month would pay S$200 in monthly mortgage payments for a two-room flat. This would be covered by CPF contributions.

On the other hand, the open market rental rate for a two-room flat could be asked for as much as $1,000.

Dr Maliki drew this example when responding to a question by West Coast GRC MP Madam Ho Geok Choo on the relevancy of home ownership versus renting.

He said home ownership is still important because it not only gives people a roof over their heads but it is also an asset which appreciates alongside the country’s economic growth. РCNA/vm

Source : Channel NewsAsia – 15 Sep 2008

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