Can a Singaporean who earns $850 a month afford to buy a Housing Board flat?
Mr Mohammad Charlie Jasni says yes.
The odd-job labourer earns that amount, and he and his family will be moving into a new two-room HDB flat in Punggol by the end of the year.
How he pays for his flat
Monthly income: $850
Total household CPF: $40,000
Cost of build-to-order flat in Punggol: $99,220
Additional CPF Housing Grant Scheme: $40,000
Remaining cost of flat: $59,220 ($99,220 less $40,000)
Estimated monthly instalment for payment: $83 for 30 years
Deduction from CPF: $83
Cash outlay: $0
He had successfully balloted for the 45 sq m build-to-order unit in August 2009.
It cost $99,220, but because he earns less than $5,000 a month, he qualifies for a government housing grant that gives him $40,000 to offset the flat's price.
This means he has $59,220 left to pay, which he will do using his Central Provident Fund (CPF) savings.
He and his wife already have about $40,000 in their CPF accounts, and this will grow as he continues to work.
Based on the Housing Board's calculations, he needs to pay a monthly housing instalment of $83 over 30 years.
'By paying the $83 out of my CPF, it means I have that little more for daily expenses,' said Mr Charlie, 33.
He is currently living with his wife and two children in a two-room rental flat in Beo Crescent. They pay $44 a month for that flat.
They are excited about their upcoming home and are already discussing renovation ideas and shopping for furniture.
'It is good to have a home of our own,' he said.
Mr Charlie's story puts a face to a statistic that has been debated in the last week.
In Parliament last Thursday, Deputy Prime Minister Tharman Shanmugaratnam revealed that 'a family with $1,000 income can now, through our housing subsidies, purchase a small flat'.
He was responding to Workers' Party member Gerald Giam's comments about Singaporeans being unable to afford a flat.
The minister's remarks sparked off much discussion in both cyberspace and coffee shops alike. Some wondered how $1,000 could buy anyone a flat, given that sum was hardly enough to support a family's daily living expenses.
The next day, National Development Minister Khaw Boon Wan explained that Mr Tharman was referring to a new two-room flat.
He added that the subsidised price of such flats was about $100,000 if the applicant was a first-time buyer. He would also be entitled to housing grants of up to $60,000.
The net selling price would thus be $40,000, and the monthly mortgage payment can be fully paid from his CPF contribution, Mr Khaw said.
In response to queries from The Straits Times, the Housing Board said it was unable to say how many households earning $1,000 a month own two-room flats. But it pointed to how that it has two schemes that target low-income, first-time buyers.
Mr Mohammad Charlie Jasni says yes.
The odd-job labourer earns that amount, and he and his family will be moving into a new two-room HDB flat in Punggol by the end of the year.
How he pays for his flat
Monthly income: $850
Total household CPF: $40,000
Cost of build-to-order flat in Punggol: $99,220
Additional CPF Housing Grant Scheme: $40,000
Remaining cost of flat: $59,220 ($99,220 less $40,000)
Estimated monthly instalment for payment: $83 for 30 years
Deduction from CPF: $83
Cash outlay: $0
He had successfully balloted for the 45 sq m build-to-order unit in August 2009.
It cost $99,220, but because he earns less than $5,000 a month, he qualifies for a government housing grant that gives him $40,000 to offset the flat's price.
This means he has $59,220 left to pay, which he will do using his Central Provident Fund (CPF) savings.
He and his wife already have about $40,000 in their CPF accounts, and this will grow as he continues to work.
Based on the Housing Board's calculations, he needs to pay a monthly housing instalment of $83 over 30 years.
'By paying the $83 out of my CPF, it means I have that little more for daily expenses,' said Mr Charlie, 33.
He is currently living with his wife and two children in a two-room rental flat in Beo Crescent. They pay $44 a month for that flat.
They are excited about their upcoming home and are already discussing renovation ideas and shopping for furniture.
'It is good to have a home of our own,' he said.
Mr Charlie's story puts a face to a statistic that has been debated in the last week.
In Parliament last Thursday, Deputy Prime Minister Tharman Shanmugaratnam revealed that 'a family with $1,000 income can now, through our housing subsidies, purchase a small flat'.
He was responding to Workers' Party member Gerald Giam's comments about Singaporeans being unable to afford a flat.
The minister's remarks sparked off much discussion in both cyberspace and coffee shops alike. Some wondered how $1,000 could buy anyone a flat, given that sum was hardly enough to support a family's daily living expenses.
The next day, National Development Minister Khaw Boon Wan explained that Mr Tharman was referring to a new two-room flat.
He added that the subsidised price of such flats was about $100,000 if the applicant was a first-time buyer. He would also be entitled to housing grants of up to $60,000.
The net selling price would thus be $40,000, and the monthly mortgage payment can be fully paid from his CPF contribution, Mr Khaw said.
In response to queries from The Straits Times, the Housing Board said it was unable to say how many households earning $1,000 a month own two-room flats. But it pointed to how that it has two schemes that target low-income, first-time buyers.
