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 were automatically transferred to their Retirement Account (RA) upon turning 55. As home loans are not available for Flexi Flats, the purchase of a $100,000 flat is often a strain on their cash flow.
Can I request that CPF 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 their Basic Retirement Sum (BRS)?
There should be a simple and clearly stated application process for this. For those whose RA funds fall below their BRS, I hope 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 Special Account (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 they are able to return the 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 help not just elderly flat buyers, but also divorcees who have to sell their matrimonial flat and have only half the proceeds to buy a new flat.
I made this speech in Parliament on 4 Mar 2022 during the Committee of Supply debate on the Ministry of Manpower.
