Most people picture the lease running down like a slow puncture. A little air each year, nothing to worry about, a problem for some far-off version of you.
It doesn’t work like that. It accelerates. And there are specific years where it suddenly bites, because of something most sellers never see coming.
It’s not the lease. It’s your buyer’s CPF.
When someone buys your flat, how much of their CPF they’re allowed to use depends on how much lease is left. Here’s the rule, straight from the CPF Board:
- A buyer can use their CPF freely only if the remaining lease covers the youngest buyer to age 95.
- If it doesn’t stretch that far, their CPF usage is pro-rated, so they can use less.
- Below 20 years of remaining lease, CPF cannot be used at all.
Read that again, because it’s the part that matters. The moment your lease stops covering a young buyer to 95, that buyer can commit less of their CPF to your flat. So they can offer less. So your pool of realistic buyers quietly thins.
Why it bites earlier than you think
You don’t feel this the year the lease looks short. You feel it years earlier, the first time a younger buyer runs their numbers and walks, because the maths no longer works for them the way it does for an older cash buyer.
Don’t get me wrong; a flat with decades of lease left isn’t a crisis. But there’s a difference between knowing where these thresholds sit and finding out the year you’re trying to sell. One of those you get to plan around. The other just happens to you.
What to do about it
Find out exactly where your flat sits against those CPF thresholds today, while you still have moves to make. Not the month you decide to list.