COS 2022: Use of CPF Funds for Housing

MP Gerald Giam

Mr Gerald Giam Yean Song (Aljunied): Sir, many residents have approached me for help to appeal to CPF to allow more flexible use of their CPF for housing. Some elderly residents have insufficient cash to complete the purchase of their 2-room flexi flats because their CPF Ordinary Account (OA) monies are automatically transferred to the retirement account upon turning 55.

As home loans are not available for Flexi flats, the purchase of a $100,000 flats is often a strain on their cash flow. Can I request that CPF Retirement Account (RA) funds which originated from their OA be allowed to be used for the purchase of 2-room Flexi flats by default as long as the CPF member’s RA balance is above the Basic Retirement Sum (BRS).

There should be a simple and clearly stated application process for this. For those whose RA funds for below the BRS. I hold CPF can exercise greater flexibility so that elderly residents are not denied a Flexi flat despite large balances in their CPF funds.

For the payment of the resale levy, can CPF consider allowing applicants who have sufficient funds in their RA or SA to take out an advance from one of these accounts which must be returned with interest within a few years. The applicant could be required to show income documents to prove that they are able to return them amount drawn. This could smoothen the cash flow problem that might be preventing them from completing the purchase of their home, while ensuring they do not prematurely exhaust their retirement funds. It will not just elderly flat buyers but also divorcees who have to sell the matrimonial flat and have only half the proceeds to buy a new flat.

4 March 2022
Ministry of Manpower

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