550,000 flats to be spruced up under upgrading scheme

First HIP will cost the Government more than $4b while HIP II will likely cost even more

The Marine Parade estate being developed in a hurry in the 1970s over just three years. But the work of redeveloping it should span decades.
The Marine Parade estate being developed in a hurry in the 1970s over just three years. But the work of redeveloping it should span decades. PHOTO: HDB

A total of 550,000 Housing Board flats will benefit under the Home Improvement Programme (HIP), the HDB said yesterday. Some 320,000 flats are already eligible under the HIP, which was introduced in 2007.

Prime Minister Lee Hsien Loong said in his National Day Rally speech last night that another 230,000 flats built between 1987 and 1997 would be included.

Flats will be eligible for upgrading when they hit around 30 years old and, not only that, HDB owners can look forward to another upgrading when the flats reach about 60 to 70 years old, PM Lee added. This second phase of the programme, HIP II, will start in about 10 years' time.

Previously, only flats built up to 1986 that had not undergone the previous Main Upgrading Programme (MUP) were offered the HIP.

There are about 320,000 flats eligible under the 1986 age band. Of that number, the HIP has been announced for about 242,000 since 2007, HDB said. Upgrading work has been completed for 122,000 flats and is under way in the rest. The Government expects to spend about $4 billion on these flats.

MUP was launched in 1990 and completed in 2011, benefiting some 130,000 additional households.

"We launched the HIP 10 years ago. The final batch of HIP flats will be announced by next year. So within a few years, all flats eligible for HIP will have been balloted, passed, executed and upgraded. That means altogether 450,000 flats upgraded under MUP plus HIP," PM Lee said.

The first round of upgrading, which includes flats built up to 1997, will start soon, Mr Lee said, adding: "Pasir Ris will get HIP, and so will Yishun, Tampines, Jurong and several other estates."

The second round of upgrading is expected to start in about 10 years' time, when flats reach 60 to 70 years of age.

The Government pays up to 95 per cent of the upgrading cost, so residents pay as little as a few hundred dollars. "The first HIP will cost the Government more than $4 billion. HIP II will probably cost even more, because the flats will be twice as old by then. But it is well justified, and we will do it as long as MOF (the Finance Ministry) has the money," Mr Lee said.

An essential upgrade, the HIP fixes maintenance problems. "We upgrade the electrical supply too... because more families have air conditioners, washing machines, computers and, now, personal mobility devices," Mr Lee said.

"It's not surprising that after upgrading, the flat value usually goes up," he said. The two rounds of upgrading keep flats in good shape. "We are determined not to let our public housing degenerate into ragged squalid slums, which has happened in many other cities."

HIP II will help flats stay liveable and retain their value as their leases run down, said Mr Lee.

ERA Realty Network key executive officer Eugene Lim said HIP II is seen as "a 2/3 life upgrade for HDB flats". It will help to rejuvenate the flats as they await Voluntary Early Redevelopment Scheme (Vers) or end-of-lease return to HDB.

The HIP, HIP II and Vers are well-rounded and innovative policies that could address the concerns of Singaporeans, OrangeTee & Tie's head of research and consultancy Christine Sun said. "As most flats will be upgraded twice before the lease expires, Singaporeans may not need to worry too much about the depreciating value of an ageing flat now," she said. "Most importantly, the new schemes ensure that there is sufficient land to be recycled for the next generation, and housing will continue to be affordable."

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A version of this article appeared in the print edition of The Straits Times on August 20, 2018, with the headline 550,000 flats to be spruced up under upgrading scheme. Subscribe