HDB flats ‘good store of asset value’ for those who plan ahead: Lawrence Wong

A Housing & Development Board (HDB) flat is a “good store of asset value” for those who plan ahead and make prudent housing decisions, National Development Minister Lawrence Wong said.

His comments, made in a Facebook post on Wednesday (Apr 12), come in response to online debate over his comments that not all HDB flats will be eligible for the Selective En bloc Redevelopment Scheme (SERS).

The minister said in a post on Mar 24 that he was “concerned” over the idea that some home buyers in Singapore were forking out high prices for older flats in the hope of benefiting from SERS. He also pointed out that when the leases for HDB flats run out, they have to be returned to the state.

On Wednesday, Mr Wong noted that Singaporean couples enjoy significant subsidies when they purchase a HDB flat for the first time – whether it is a new or resale flat.

“Take for instance a 30-year-old couple, with a combined monthly income of S$5,000, looking for a resale flat in Woodlands near their parents. They can get up to S$75,000 in grants off the resale flat price, and should easily afford a flat with a lease of 90 years.

“Thirty-five years later, the couple will be 65 and the remaining lease of the flat will be 55 years. They still have an asset which can be monetised for retirement,” he said.

He also noted that elderly couples can opt to sell their flat and “right-size” to a two-room Flexi flat with a shorter lease, to enjoy the Silver Housing Bonus of S$20,000 in cash and use their sale proceeds for their retirement.

Those who prefer to stay in the same flat can apply for the Lease Buyback Scheme and sell part of the remaining lease back to HDB, Mr Wong said. They also have the option to rent out a room, he added.

These examples are simple, but typical of many HDB households, he said.

“The general point is that the HDB leasehold flat is not only a good home, but also a nest-egg for future retirement needs. That’s what we have achieved and that’s what we will continue to ensure – both now and in the future.”

Source : Channel NewsAsia – 12 Apr 2017

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