Okay, this might be old news.. Transferred from the other lock
thread.. Such a change in the policy does help the gay community
little.. Hmm, should I invest in private property?
July 20, 2005
change in singapore private housing policy advantageous to gay
couples
By News Editor
Eased restrictions on property financing and foreign home ownership
will benefit same-sex couples who are planning to jointly purchase
private residential properties using their pension funds and
foreigners looking to buy private homes in Singapore.
Thirty-something couple, Jann and Wei, who have been together for
two years were ecstatic when the Government announced that two
non-related parties can now jointly purchase a private residential
home using their Central Provident Fund (CPF) savings or pension
funds.
Weve been mulling over buying a condo unit together for some time
but have been unable to do due to previous restrictions on using
both our CPF monies, Jann said. Its wonderful that we now
utilise our CPF funds as not being able to do so would really limit
our options.
In a surprise announcement on Tuesday, the Government revealed that
two non-related parties such as same-sex couples can now jointly
purchase private residential properties using their pension funds
as a longstanding rule that prohibits non-related parties from
using their CPF savings jointly in the purchase of private
properties was lifted.
The move is part of its package of policy changes relating to the
property market announced by Singapore Minister of National
Development Mah Bow Tan in parliament.
Previously, only joint owners who are immediate family members
(i.e., spouse, children, siblings and grand-parents) may utilise
their CPF monies in the purchase of a private property. Same-sex
couples who wished to finance their property jointly could only do
so if they were both unmarried Singapore citizens, 35 years of age
or above and purchased a Housing & Development Board (HDB) or
public housing flat from the open market.
The measure attracted garnered some debate. According to the
Singapore Business Times, Ho Geok Choo (West Coast GRC) asked in
parliament if the new CPF ruling went against the Government's
'pro-family policy' and if making CPF savings available to
non-related singles for buying private property would "promote
homogenous gender or heterogenous gender" partnerships.
National University of Singapore Environmental Management Programme
director (School of Design and Environment) Dr Malone-Lee Lai Choo,
said in reply, "If people want to live together, they don't need to
buy their own property to do it."
The longstanding rule that only single citizens who are at least 35
years old can purchase a HDB flat from the open market remains
unchanged.
The new regulations would also permit foreigners to buy apartments
in non-condominium developments with fewer than six floors in
addition to condominium units although they will still need
approval to buy landed property.
As there appears to be no restriction on the use of CPF savings by
non-Singaporeans, it is expected that non-related singles,
Singaporean or not, would be allowed to use their CPF savings to
jointly purchase private residential property.
Foreigners seeking permanent residency (PR) status can now invest
up to S$1 million (US$590,000) in a private residential property as
part of the S$2 million they need to invest in the city-state to be
considered for PR, provided he meets other conditions.
Under the revised regulations, buyers will be able to borrow up to
90 per cent of the total purchase price instead of the previous 80
per cent for both private and public residential properties. Cash
downpayments will be cut to five per cent from 10 per cent, with
the remaining paid from the buyers CPF account. For HDB flat
buyers, the cash downpayment now at four per cent which was
originally planned to reach 10 per cent in 2008 will be capped at
five percent from 2006.
Buyers can now tap on their CPF savings to buy properties with
remaining leases of between 30 and 60 years. Previously, buyers
could not use CPF funds to buy 99-year leasehold properties with
less than 60 years left on the lease. CPF withdrawal limits for the
purchase of such properties will however be pegged to the age of
the purchaser and the remaining lease of the property to ensure
that an owner will not outlive his property, based on the average
human lifespan of 80 years.
Nearly all the policy change will come into effect
immediately.
Property-related stocks on the Singapore stock exchange soared to
multi-year highs yesterday as analysts called the move an effort to
revive one of Asia's most sluggish markets.
Mah however maintained that revising the policies was neither to
boost nor depress the property market but changes from time to
time is necessary to ensure their continued relevance to broader
social and economic objectives and to improve structural rules
and functioning of the property market.
Observers say gays and lesbians living in Singapore will greatly
benefit from the change in regulations, especially the large number
who are in long-term relationships. Now that they are newly
eligible to combine their incomes and CPF to purchase private
residential property, developers and those selling their property
are likely to see a spike in gay and lesbian couples shopping for
their first home. This will apply across the board to all classes
of property, from economical to high-end luxury developments, as
there is a broad range of income levels in the gay and lesbian
community.
In 2001, Fridae polled its gay and lesbian members residing in
Singapore. Of the 595 respondents, 39 per cent declared that they
were "attached" or "living with partner." Furthermore, 40 per cent
of the respondents who were in relationships have been with the
same partner for more than six months at the time of the
survey.
The same survey revealed that a high proportion of respondents
lived with parents, while only 22 per cent indicated that they own
or rent their homes. This is despite the relatively high income
levels of the respondents, with 50 per cent earning more than
S$80,000 (US47,00) per annum 20 per cent reporting income levels
of more than S$180,000 per annum, 11 per cent between S$120,000 to
S$180,000 and 19 per cent between S$80,000 to S$120,000.
The low percentage of home ownership is thus likely a direct result
of regulations that have until now restricted non-related singles
from jointly owning private or HDB property.
Some 80 percent of the 4.5 million people in the city-state live in
public housing. Ninety-three percent of the population owns a home
the highest ownership level in Asia.
