In a blog post yesterday (16 Dec), National Development Minister Lawrence Wong said that 2019 has been a busy year for his ministry. “We are doubling down on our efforts to build affordable flats and good homes for all Singaporeans,” he said.
“Many of them purchased new flats in non-mature estates (NMEs) like Punggol, Sengkang or Tengah. We price these flats at generous discounts to the market. As a result, the vast majority of buyers of new NME flats spend little or zero cash outlay on their mortgage payments.”
He also reminded all that the government made two major policy moves this year, raising the income ceilings for HDB flats and introducing a new Enhanced CPF Housing Grant for Singaporeans.
“They (Singaporeans) can enjoy up to $80,000 in grants when they buy a new flat (which is sold at a discounted price), and up to $160,000 in grants when they buy a resale flat in the open market,” he pointed out.
He also mentioned that the government has been spending about $3 billion on various HDB upgrading programmes over the past 5 years.
To help seniors use their HDB flats to supplement retirement income, he said that HDB has extended the Lease Buyback Scheme (LBS) to cover all HDB flat types, “This allows HDB owners, upon reaching the age of 65, to unlock value from their flats to supplement their retirement income, and still continue to have a home for life.”
This year, the take-up for LBS has nearly doubled to around 1,500 households, he revealed.
Voluntary Early Redevelopment Scheme (VERS)
In his post, Minister Wong also talked about the Voluntary Early Redevelopment Scheme (VERS) mentioned by Prime Minister Lee Hsien Loong at the National Day Rally (NDR) in Aug this year.
During the NDR, PM Lee mentioned about VERS which will allow HDB households to benefit from redevelopment before the 99-year leases on their flats expire. The scheme is for flats which reach about 70 years of age.
PM Lee said that the Government will compensate residents whose flats are taken back early, and will also help them get another flat to live in, just as they would if their leases had run out. But the terms will be less generous than that of the Selective En-Bloc Redevelopment Scheme (SERS), as there will be “less financial upside”, he said. The residents would have to vote for VERS.
“If the residents vote yes, we will proceed,” PM Lee explained. “The Government will buy back the whole precinct, all the flats and redevelop it, and residents can use their proceeds to help pay for another flat.”
In any case, Minister Wong said they are working out the implementation details of VERS, and will share more when ready. He said, “Meanwhile, in recent weeks, there have been several alternative suggestions to VERS, including different ways to manage the expiring of HDB leases. MND will consider all such feedback and ideas, and study them in greater detail.”
“It is worth noting that across these different proposals, there is common ground on some key fundamentals. In particular, there is broad-based recognition of the need for urban renewal in our land-scarce city, so that land can be recycled, and new flats can be built for future generations. This is the reason why so much of our land is on a leasehold basis, be it for private or public
residential properties,” he added.
“Indeed as our HDB estates get older, there will be a greater need for comprehensive redevelopment and renewal works. The Government is committed to this long-term undertaking.”