The Housing and Development Board (HDB) is taking steps to make home ownership more attainable for young couples with its newly expanded Deferred Income Assessment (DIA) scheme. Minister for National Development Desmond Lee made the exciting announcement during an engagement session at the National University of Singapore on 26 March 2024.
Changes to the Deferred Income Assessment Scheme
Starting from the next Build-to-Order (BTO) launch in July, couples will benefit from relaxed eligibility requirements. Now, only one partner needs to be a full-time student or serving National Service. This means that, for example, if one partner earns $3,500 a month while the other is still studying, the couple can apply for a flat and defer their income assessment for around three years until they collect their keys.
Financial Flexibility and Housing Options
- The scheme allows for greater loan amounts, enabling couples to aim for bigger flats.
- Couples will only need to make a 2.5% down payment instead of the regular 5%.
- Eligibility is new for those who’ve completed studies or National Service within the last year and have at least one partner aged 30 or below.
Minister Lee highlighted that this initiative aims to alleviate financial stress for young couples, who may feel overwhelmed by rising property prices. He reassured them that various affordable housing options remain available, reinforcing that there is no need to rush into purchasing a home.
Challenges with Future Income Assessment
However, as property experts point out, the changes come with risks, as they shift the focus from immediate to projected future earnings. Christine Sun from OrangeTee mentions that while this allows for the possibility of buying pricier homes, it also adds pressure on couples to accurately estimate their future salaries.
Couples will need to adhere to strict income ceilings to remain eligible for HDB loans and grants, currently set at S$14,000 (approximately US$10,500) per month.
Feedback from Young Couples
Some university students expressed mixed feelings about the scheme. While final-year NTU student Ms Huang observed that the deferred income assessment might reduce grants available at the time of purchase, others, like Jesslyn Tan, appreciated the expanded eligibility for couples in long-term relationships.
Art design student Wong Yi Xiu stated, “It’s better when my partner is in the same phase in their life as me before I get a flat,” emphasising that focusing on career stability takes precedence for now.
The Future of Public Housing
Minister Lee reiterated the government’s commitment to provide adequate housing options, pledging to exceed the launch of 100,000 BTO flats from 2021 to 2025, with waiting times now at less than four years. This initiative not only aims to lessen the burden on newlywed couples but also positions the HDB as a facilitator for Singaporeans at various stages of their life journeys.