Property Views

[Property Agent]

REMEMBER THIS TERM \"HDB ESSENTIAL OCCUPIER”


I met an old friend a couple of days ago and during our conversation, she told me her son had applied for a BTO flat together with his girlfriend. My immediate question to her was “Did he and his girlfriend both apply as owners?”, to which she answered with a “Yes”. Being aware of the fact that her son intended to purchase a private property in the future, I told her that there was a way to cut unnecessary spending and save money on taxes. I suggested to her that they should apply as Owner + Essential Occupier instead.

As a parent myself and seeing how purchasing the 1st HDB flat is such a big milestone in our children’s lives, I would like to share this important piece of information with you all.

HDB requires applicants to form a family nucleus in order to become eligible to purchase an HDB flat. The flat can be registered either under at least 2 Owners or Owner + Essential Occupier. When your child wants to purchase an HDB flat with his/her partner, please do advise them to apply as Owner + Essential Occupier. Please advise them not to apply as 2 Owners unless there is a need to use both persons’ CPF. If they do happen to apply as 2 Owners, they would have to pay ABSD, a whopping 12% tax for citizens buying their 2nd property, if they were to buy a private property in the future. The government no longer allows decoupling on HDB flats.

On the other hand, if your child and his/her partner were to apply for an HDB flat as Owner + Essential occupier, they would not have to pay ABSD if they purchase the private property under the person who is registered as Essential Occupier of the HDB flat as the private property would be considered as his/her first property.

So, please keep in mind the term “Essential Occupier” and you and your family will be all set.

[zac's mum]

This is fine advice. Provided the relationship is truly solid. Legally, the party who is not listed as Owner will stand to lose out if the marriage ever ends in divorce, no?

[MrsKiasu]

Our time, both must ROM before can buy hdb. If can only put one as owner, I wonder why need the ROM.

[doodbug]

All along, even during our time, you can buy with one owner + one occupier. We are even allowed to decouple if we had bought using two owners.

Essentially, you need a qualifying family unit to buy a HDB. The qualifying family unit can be a combination of owner and occupiers. Occupiers cannot use their CPF to pay for the flat though.

[MrsKiasu]

Oic, so decouple is just shift 1 name from Owner to occupier and to return whatever paid using the now Occupier’s CPF, I guess… if that’s the case then no worries of legal consequences for divorce cases probably if all money is from the legal Owner

[doodbug]

HDB disallowed decoupling from 2016. When I decoupled, yes, I paid my hubby’s CPF plus accrused interest, using cash. For divorce cases, best to check with lawyers. If you are an occupier, but you can prove you have contributed towards the flat (say in cash payments or whatever), I would imagine one would have a case to argue for a portion of the flat or sales proceeds. That’s just my layman’s guess.

[MrsKiasu]

Now disallowed already arh haha… I didn’t know that. Good to know…


The current one as suggested earlier…1 Owner+1 essential occupier…very obvious also.

[doodbug]

Now allows you to have one owner + one occupier at the outset, but no longer allows decoupling midway down the road

So best to start with with that position. However, most couples who want to utilize both person's CPF for downpayment, will not be in a position to do this.

[zac's mum]

Nowadays HDB so expensive, rare to be able to use one person’s CPF to pay the mortgage totally.


But let’s take an example scenario of Husband using his CPF to pay for the flat. He puts himself as Owner, wife as Essential Occupier. If in the event of Husband passing away, or initiate divorce, does the wife have any claim to half the flat as a marital asset? Or does she have zero to her name because she’s “just” an occupier? Will she lose the roof over her head? Leaving her (and any kids) homeless and assetless?

[doodbug]

It depends on whether the husband has a will.

Without a will, it will follow Singapore's intestacy laws.
https://www.gjclaw.com.sg/articles/laws-of-intestacy-in-singapore/