New VERS scheme for aging HDB

[pegasi]

NDR 2018: Scheme planned to redevelop more old HDB flats before leases end

 

source: https://www.channelnewsasia.com/news/singapore/ndr-2018-scheme-planned-to-redevelop-more-old-hdb-flats-before-10631458

 

 

SINGAPORE: The Government is planning a new scheme which will allow more HDB households to benefit from redevelopment before the 99-year leases on their flats expire, Prime Minister Lee Hsien Loong announced on Sunday (Aug 19).

The Voluntary Early Redevelopment Scheme (VERS) is part of a “long-term plan” to allow the Government to progressively redevelop precincts, Mr Lee said in his National Day Rally speech. It will take place when the flats reach about 70 years of age, he added.

Mr 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”.

Hence, he said, the scheme will be voluntary, and residents would have to vote for VERS, just like they currently do for the Home Improvement Programme (HIP).

Read more at https://www.channelnewsasia.com/news/singapore/ndr-2018-scheme-planned-to-redevelop-more-old-hdb-flats-before-10631458

 

[pegasi]

Summary of the VERS

 

1) with Voluntary Early Redevelopment Scheme (VERS), owners of older HDB flats will now get a shot at going en-bloc before their leases run out, hence less worry of value going to zero when lease expires

 

2) Under VERS, these residents in eligible precincts can vote to have the Government take back their flats, starting from around the 70-year mark of their lease.

 

3) The move will also allow the authorities to progressively redevelop old estates over a longer period, instead of only when their leases expire.

 

4) compensation terms will be less generous than those for the Selective En bloc Redevelopment Scheme (SERS), because there is less financial upside for the government to take back these flats early.

 

5) Only 5 per cent of flats are estimated to be eligible for SERS, the rest can opt for VERS through collective agreement (details to be confirmed)

[13177]

When the flat is 70 year old, the remaining lease is 29 years. If the voting for VERS failed, by then if owner wants to sell the flat in the open market, dont think there will be any buyers or flat worth much.

[pegasi]

likewise for pte lh99, not every aging condo put up for enbloc sales gets the deal

at least with VERS , hdb owners now have another option , rather than let the asset depreciate to zero at 99th yr

 

When the flat is 70 year old, the remaining lease is 29 years. If the voting for VERS failed, by then if owner wants to sell the flat in the open market, dont think there will be any buyers or flat worth much.

 

[13177]

likewise for pte lh99, not every aging condo put up for enbloc sales gets the deal

at least with VERS , hdb owners now have another option , rather than let the asset depreciate to zero at 99th yr

But hdb only allow owners to opt for VERS when the flat is at the age of 70 years which i think too old liao. If owners can accept their flat to reach 70 years and still staying in that flat, dont think the owner would want to move out from the flat lo.

[pegasi]

true also

70yr is a long time to wait

say a person bought the new hdb at age 25, 70yr later he 95yr old

maybe no more around, and his kids already nearing 70yr old also, cannot take over the old house and need to sell in resale market; plus, who want to buy 70yr old house for own stay, unless is for enbloc purpose

so the new gen of owners who speculate in 70yr old houses will become the new owners and put up the VERS request , provided they are following HDB eligibility to sell

 

But hdb only allow owners to opt for VERS when the flat is at the age of 70 years which i think too old liao. If owners can accept their flat to reach 70 years and still staying in that flat, dont think the owner would want to move out from the flat lo.

 

[Mockngbrd]

hdb will calculate value of flat based on 70 Yr old resale value :p

[Inlinefour]

Value of 70 yo can’t even buy a main door...TCSS only lah

[RH1667]

After selling / en-block the 70 years old flat, those will are old and jobless can afford to buy another one ? How about cost of Reno, furniture etc ? Need to get new loan again, by that time, don’t even know any bank/HDB will approve the loan or not.

[Kopites]

But hdb only allow owners to opt for VERS when the flat is at the age of 70 years which i think too old liao. If owners can accept their flat to reach 70 years and still staying in that flat, dont think the owner would want to move out from the flat lo.

nod Nod..must consider the resident mix of those 70yo residents.

Old folk or working adult.

After selling / en-block the 70 years old flat, those will are old and jobless can afford to buy another one ? How about cost of Reno, furniture etc ? Need to get new loan again, by that time, donât even know any bank/HDB will approve the loan or not.

yes yes...

 

many factors. shifting to another estate. financial cost for old folk since is not one-one replacement.

Edited August 19, 2018 by Kopites

[13177]

hdb will calculate value of flat based on 70 Yr old resale value :p

They really know how to calculate, implement such VERS scheme. Advantage to themselves again but not the people.    

[Evillusion]

They really know how to calculate, implement such VERS scheme. Advantage to themselves again but not the people.

its well-known that every policy churned out is actually targetted for results 20-30 yrs down the road. For every plan made there is a contingency plan should the initial target becomes untainable. Nothing is done on a wimp......

[Kusje]

likewise for pte lh99, not every aging condo put up for enbloc sales gets the deal

at least with VERS , hdb owners now have another option , rather than let the asset depreciate to zero at 99th yr

 

enbloc there can be many potential buyers.

 

for VERS, there is only one buyer.

 

Am sure even non-economics students know what happens to the price when there is only 1 buyer in the market. But yeah, at least it is an "alternative".

Edited August 20, 2018 by Kusje

[pegasi]

got rice eat rice

got porridge eat porridge

 

enbloc there can be many potential buyers.

 

for VERS, there is only one buyer.

 

Am sure even non-economics students know what happens to the price when there is only 1 buyer in the market. But yeah, at least it is an "alternative".

 

[Volvobrick]

After selling / en-block the 70 years old flat, those will are old and jobless can afford to buy another one ? How about cost of Reno, furniture etc ? Need to get new loan again, by that time, don’t even know any bank/HDB will approve the loan or not.

 

Assuming the flats are taken back at 30% of a new flat's price, the old can be sent invited to move to a retirement/nursing home in Johor using the proceeds.  Should be enough together with other subsidies/CPF.

 

Jobless ones - go get a job!

[Showster]

My guess is roughly 50% of price compensation as compared to a new HDB flat in the vicinity (at future prices), when the HDB reaches 70 years old. 40-60% would be acceptable.

 

http://smartpropertybuyer.blogspot.com/2008/09/99-leasehold-property-calculation-of.html

[Jman888]

if HDB 99 lease can last forever, then singapore no more condo.

[Kopites]

They really know how to calculate, implement such VERS scheme. Advantage to themselves again but not the people.

definitely. a political leverage when come to election time. Picture what type of speech will be garner during election rally.