The Ministry of National Development (MND) has recently announced enhancements to both the Silver Housing Bonus (SHB) and the Fresh Start Housing Scheme during the Committee of Supply debate. These adjustments are part of the government’s continuous efforts to support the elderly in downsizing and improve public housing accessibility for lower-income households living in HDB rental flats.
The Silver Housing Bonus encourages seniors to plan for their retirement by unlocking the value of their residential assets and transferring it into their CPF Retirement Account (RA). Currently, to be eligible for the SHB, applicants must be at least 55 years old, have a monthly income of no more than $14,000, own a property with an Annual Value (AV) of $21,000 or less, and their replacement property must be a three-room HDB flat (excluding three-room terrace) or smaller.
Under the current SHB system, applicants can choose to make a cash top-up of up to $60,000 to their CPF RA and receive a bonus of up to $30,000 in cash. This amount is calculated on a pro-rated basis, with $1 cash bonus given for every $2 top-up made into their RA.
From December 1, 2020, applicants will be able to receive the SHB cash bonus if they can show that their downsizing exercise has resulted in an increase in their RA balance from any source, including CPF housing refunds. This means that seniors who still have outstanding loans on their property that were paid using their CPF accounts may no longer need to make a cash top-up to qualify for the SHB.
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Furthermore, the SHB eligibility criteria have been expanded to include seniors who own properties with an AV of more than $21,000 but equal to or less than $13,000. This extension is expected to benefit an additional 15,000 seniors. These applicants will also receive a cash bonus based on the increase in their RA balance, up to $60,000. However, the amount will be pro-rated at $1 cash bonus for every $6 increase in their RA, with a maximum bonus of $10,000. Successful SHB applicants who downsize to a two-room or smaller HDB flat (including Community Care Apartments) will also receive a non-pro-rated $10,000 cash bonus in addition to the pro-rated amount.
Seniors can apply for the SHB within one year of their second property transaction. This means that those who have completed their downsizing exercise after December 1, 2024, will be eligible to apply for the enhanced SHB on December 1, 2025.
The Fresh Start Housing Scheme, launched in 2016, offers financial aid and social support to Second Timers (ST) families who have previously owned a subsidised HDB flat, with the aim of helping them become homeowners again. Under the current scheme, applicants can purchase two-room flexi or three-room standard BTO flats on shorter leases, typically lasting from 45 to 65 years until the youngest owner turns 95. Flats bought under this scheme are subjected to an extended Minimum Occupation Period of 20 years, compared to the usual five years.
The recent improvements to the scheme include an increase in financial support. Eligible families will now receive $75,000 under the Fresh Start Housing Grant, up from the previous amount of $50,000. This new grant will consist of an initial $60,000 credited to the applicant’s CPF Ordinary Account (OA) before the key collection date. The remaining $15,000 will be disbursed over the next five years to support mortgage payments.
The eligibility criteria for the Fresh Start scheme have also been expanded to allow First-Timer (FT) families to apply. Although FT families are not entitled to the Fresh Start Housing Grant as they can benefit from the larger Enhanced CPF Housing Grant (EHG) of up to $120,000, they will still receive assistance through the reduced cost of the shorter-lease BTO units and social support provided by the program.
FT families can apply to the Fresh Start scheme from April 2025, while the new Fresh Start Grant amount will take effect from the July 2025 BTO exercise.