Debt Service Ratio of Singaporeans who Bought HDB Flats

Assoc Prof Dr Muhammad Faishal Ibrahim asked the Minister for National Development over the last three years what is the debt service ratio (DSR) of Singaporeans who purchased new and resale HDB flats and how do these DSRs vary across the different room types.

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Mr Khaw Boon Wan: From 2009 to 2011, the average Debt Service Ratios for first-timers buying new flats, in both mature estates and new towns, were 25%, 22%, and 24% respectively. Excluding transactions in mature estates, the corresponding figures for purchases in new towns were 21%, 22% and 24%.

For resale flats, the average DSRs for first-timers from 2009 to 2011 were 24%, 24% and 25% respectively. If we exclude the mature estates, the corresponding figures were similar, at 24%, 24% and 25%.

DSRs for smaller flat types are generally lower as more grants are given to the lower income. For example, in 2011, the DSRs for 2-room and 3-room new flats were 17% and 23% respectively. This is lower than the DSRs for 4-room and 5-room flats, which were 26% and 25% respectively.

The DSRs indicate that first-timer households are prudent in the selection of their homes. The various Government grants have also eased their debt burden, allowing them to service their monthly installments using their CPF contributions, with little or no cash outlay.