HOUSING MATTERS
8 Things You Should Know About The Proximity Housing Grant
The use of the Proximity Housing Grant (PHG) has certainly increased since the start of it in 2015. It encourages children to live nearer to their parents or even vice versa.
The fact that prices of property are certainly quite high for an average Singaporean, any grant that is up for grabs is certainly a must-have. Therefore, it makes sense for the use of this grant has increased over the past few years.
This article will give you more information about the Proximity Housing Grant.
#1 Higher Grant When Staying With Parents (All Under One Roof)
For families who want to apply for the PHG, there 2 options that are available.
As you can see from the graphic above, you will get a higher grant if you stay with your parents. In other words, you, your children and parents are in the same flat.
However, if you buy a Resale flat within 4km of your parents home, you will get $20,000. That is $10,000 lesser than the previous option.
Living in a flat with your children and parents all under one roof might be quite a handful, but at the same time, $10,000 extra of grants is also useful at the same time.
Therefore, this may not be an easy decision for everyone. Make sure you foresee any challenges if you opt for the higher grant. One thing to take note perhaps is the fact that you might need more space if you decide to have more children. You can expand your family but it is not the same with a flat.
#2 4Km equals to 40 Minutes of Moderate Walking
If you choose to live nearby your parents instead of living with your parents, you do need to buy a flat within 4km of your parents’ property.
To give you a scenario, 4km is approximately worth 40 minutes of walking. Why do we highlight this?
It is believed that the PHG was introduced so that couples are able to love close to each other for mutual care and support. Therefore, in the case of an emergency, they can attend to their parents in a shorter amount of time.
Imagine if you are home and you got a call that your father fell down. You would need to walk about the same distance of running around the stadium track 10 times.
Well, you can equally say that you will drive or just take a taxi there. But all this is just to give you a picture of what 4km might look like. It could be near to some or it could be lightyears away to others.
#3 Your Parents are able to sell their own home
The higher grant is given to families that decide to have their parents staying with them. And it also would mean that your parents are able to sell their own flat or property.
By selling their property, they are able to fund themselves for anything. It could be their medical expenses, health insurance premiums or even their holidays.
That will certainly help the family as a whole. That could be another source of income on top of their CPF monies and investments. As inflation tends to get higher every year, that boost of money from the sales proceeds can help ‘fight’ any unexpected increase in prices
But do take note, you will have more people under one roof since your parents do not have their own home.
#4 Smaller Loan Amount
With a grant, you are able to lower down the loan that you would need to take on. That will certainly help you save a lot of money.
With a lower loan amount, you will be a lower interest. And your monthly mortgage will be more manageable.
#5 Applicable towards singles too
This is great news for singles.
The grant, however, is not as high as the family grants.
When living with your parents you will get a grant of $15,000. But if you live near your parents, you would get a grant of $10,000.
#6 You can only Use it once
Yes, there is indeed a slight catch. You can only use it once.
Therefore, if you are really keen on buying a resale flat, make sure you have all your heart and mind on that decision. There is no refund when buying a home.
You have to sell it and then buy a new one.
#7 Your parents can apply for it too
The PHG works both ways. Not necessarily mean that you are the one that has to buy a new place. Your parents can also be the one moving.
Sometimes we already are staying in the home of our dreams. Unfortunately when our parents’ age, they can fall sick. Therefore, you do not have to sacrifice and sell your dream home.
Your parents can move in closer to you, Somehow, you can say it is a win-win situation.
#8 Flat Lease must be at least 30 Years and above
Yes, if you intend to buy a flat that has a lease of 25 years lease left, you are not able to get the PHG.
This is aligning with the inability of using your CPF monies to buy a flat that has a lease that is below 30 years.
It somehow shows that is almost impossible to buy an “old” flat.
Grab all the grants when possible
The good thing about the PHG is that you can still apply for the other available grants as well. It is not mutually exclusive.
Therefore, if you are eligible for the other grants, do accept them. It will definitely help you in financing for your home.
Disclaimer
I am a financial adviser but I am not your financial adviser. Therefore, what is posted on this website, are my opinions and NOT to be taken as financial advice. Information provided might be relevant at this period of time but may be irrelevant due to alterations to rules, regulations or policies. The information provided is true to the best of my knowledge, but there maybe omissions, errors or mistakes.
