Why EIP exists
The Ethnic Integration Policy sets maximum proportions of flats that can be owned by each ethnic group (Chinese, Malay, Indian & Others) at both the block and neighbourhood level, to maintain a healthy ethnic mix across HDB estates and avoid the formation of enclaves.
How it affects buyers and sellers
If a block or neighbourhood has reached its quota for a particular ethnic group, buyers from that group cannot purchase a resale flat there, even if a willing seller and agreed price exist — the transaction simply cannot proceed until the quota frees up (e.g. when an existing owner from that group sells).
SPR (Permanent Resident) quota
A separate quota caps the proportion of flats in a block/neighbourhood that can be owned by Permanent Resident households, distinct from the ethnic group quotas.
Always check current EIP/SPR quota status for a specific block before falling in love with a flat — your agent or HDB's resale portal can confirm eligibility for a specific unit before you negotiate.