There’s been quite a bit of buzz in the housing scene recently. Do you know what the three acronyms below stand for? Test yourself!

LBS

Lease Buyback Scheme

Through the Lease Buyback Scheme (LBS), HDB home owners will be able to monetise their flats to receive a stream of income in their retirement years, while continuing to live in it.

Home owners can sell part of their flat’s lease to HDB and choose to retain the length of lease based on the age of the youngest owner. The proceeds from selling part of their flat’s lease will be used to top up their CPF Retirement Account (RA). They can then use their CPF RA savings to join CPF LIFE, which will provide them with a monthly income for life.

Here’s an illustration of how it works:

Retrieved from HDB’s Facebook

MSR

Mortgage Servicing Ratio

The Mortgage Servicing Ratio (MSR) refers to the portion of a borrower’s gross monthly income that goes towards repaying all property loans, including the loan being applied for. Under this rule, a maximum of 30% of a borrower’s gross monthly income can be used for monthly loan repayments.

Calculation of MSR

Monthly repayment installments for all property loans

Gross monthly income

100%

A thing to note is that MSR applies only to housing loans for the purchase of an HDB flat, or an executive condominium (EC) where the minimum occupation period has not expired.

PLH

Prime Location Public Housing

After extensive engagements with the public, experts and industry stakeholders, the Prime Location Public Housing (PLH) model was developed to ensure that new public housing built in prime, central locations like the city centre and the Greater Southern Waterfront will remain affordable and accessible for Singaporeans.

Retrieved from HDB’s Facebook