SINGAPORE - Some owners of flats undergoing the Selective En bloc Redevelopment Scheme (Sers) in Ang Mo Kio said they will likely take up a new rehousing option for a replacement flat on a shorter 50-year lease.
It is one of two new rehousing options introduced on Saturday (July 2) by the Housing Board to provide more options that meet the different needs of Sers flat owners.
Sers flat owners in Ang Mo Kio will be the first to get these options.
Technician Ghazali Abdul Rahman, 60, told The Straits Times that the new option will allow him to move into his new flat when he is set to retire in 2027 with some cash in hand.
He is considering a three-room replacement unit that is just slightly smaller than his current three-room corner unit, but getting one with a 99-year lease would have left him owing an estimated $40,000 for his new home.
Residents of Blocks 562 to 565 Ang Mo Kio Avenue 3 were told on Saturday that they could take a three-room or larger flat at the replacement site on a shorter 50-year lease, if the new flat is able to last the owners until they are 95.
Alternatively, they can opt for the lease buyback scheme at the existing Sers flat if they are aged 65 and over.
This is the first time that the HDB is offering four-room flats on a shorter lease.
The new options come after residents had raised concerns about having to shell out as much as $100,000 in cash for similarly sized replacement units.
Mr Ghazali, who occupies a 13th-floor unit with his wife, said he thinks the option of taking the 50-year lease is reasonable and the one which he is most likely to consider.
Similarly, retired writer Pauline Dawn Loh, 65, said she is happy about the HDB's swift response to residents' concerns.
She said: "It would have been very difficult for us to bridge the gap in the prices between the old flats and the new flats."
Ms Loh, who lives with her husband who is also a retired writer, said the price difference between their current 82 sq m corner three-room flat and a slightly smaller 80 sq m four-room flat in the new block is estimated to be about $80,000.
She said: "In our estate, the void decks have more funerals than weddings. We are a very settled estate where most of the demographic is older and more mature, living in three- and four-room flats - meaning smaller families with adult children."
She added that it would have been hard for many to get a loan, although the couple's 40-year-old son offered to help them with the top-up.
Before Saturday's announcement, new replacement flats came with a 99-year lease.
This, coupled with the fact that the residents' older flats - finished in 1979 - were on average larger than the new ones with the same number of rooms, meant that many residents were facing large costs if they wanted to move into a new flat of a similar size, as they would have to top up the difference in prices between the two.
The new options will also be extended to flat owners of Blocks 212 to 218 Marsiling Crescent/Lane whose flats were announced for acquisition for the redevelopment and extension of Woodlands Checkpoint, the HDB said on Saturday.
MP Zaqy Mohamad, who oversees the ward in Marsiling-Yew Tee GRC where the blocks in Marsiling are located, said he had given feedback to the HDB on behalf of some of his constituents.
He said: "The shorter lease is a good option for many seniors who have been living here for 40 to 50 years and have fully paid off their mortgages, and may not have found a replacement flat with a 99-year lease top-up useful...
"It is a good outcome and a ground-breaking move by HDB."
Mr Goh, an Ang Mo Kio Sers flat owner who declined to give his full name, citing ongoing discussions with the HDB, said he hopes the board will look into the issue of flats' valuations.
He said: "The problem which we are actually facing and what made the top-up costs so huge is the big difference in the estimated valuation of our current flats versus the new flats."
The retiree, who is in his 60s and who used to work in the marine industry, said his current four-room flat was valued at roughly between $410,000 and $450,000, while a new flat of an equivalent size was slated to go for up to $100,000 more.
He said: "Most of us here worked very hard to pay off our mortgages. Why should we be asked to downgrade our flat size or top up at all?"
Four rehousing options under Sers
There are now four rehousing options for owners of flats under the Selective En bloc Redevelopment Scheme (Sers), following two new ones announced yesterday.
- The Housing Board will offer residents a replacement flat of the same type on a 50-year lease instead of a 99-year lease. This is available for residents if the new lease can last them until they are 95 years old - this means flat owners and their spouses must be at least 45 years old at the time the flat acquisition under Sers is announced.
- Flat owners who are at least 65 years old who have not taken up the lease buyback scheme will now be allowed to. Previously, those who had not done so at the time Sers was announced were barred from applying to the scheme. Under the lease buyback scheme, flat owners can keep a lease length that will cover them and their spouses until they are 95 and sell the remainder lease to HDB.
- Flat owners can apply for new flats elsewhere in Build-To-Order exercises, Sale of Balance Flats exercises or open booking with their rehousing benefits.
- They can sell their Sers flat with the rehousing benefits, or take up an ex-gratia payment of $30,000 plus the Sers grant - if they are eligible - on top of their compensation, instead of the Sers rehousing benefits. They can then buy a resale flat from a variety of locations at various prices and lease lengths.
Correction note: This article has been edited for accuracy.