Not all old HDB are eligible for en bloc: Lawrence Wong

[Arcachon]

SINGAPORE — Do not assume that all old HDB flats will be automatically eligible for the Selective En bloc Redevelopment Scheme, or SERS, National Development Minister Lawrence Wong cautioned in a blog post on Friday (March 24).

Expressing his concern that some buyers are forking out high prices for older flats in anticipation of SERS which was highlighted in a Lianhe Zaobao report last week, Mr Wong noted that only 4 per cent of HDB flats have been identified for SERS since the scheme’s launch in 1995.

“SERS, as the name implies, is on a selective basis,” he emphasised. “For the vast majority of HDB flats, the leases will eventually run out, and the flats will be returned to HDB, who will in turn have to surrender the land to the State.”

He also advised couples – especially younger buyers – to be realistic when buying flats with short leases, as flat prices will drop correspondingly towards the tail-end of the lease.

First-time home-buyers should also choose a resale flat with a sufficiently long lease to cover their needs, he added. For example, with average life expectancy being close to 85 years now, a 30-year-old couple should aim to buy a resale flat with at a lease of at least 65 years to last them till they are 95.

He added that such properties with longer leases can benefit from the appreciation in property value in the medium-term, especially after factoring in the Government’s housing grants and subsidies.

Support for SERS has been strong, according to a biennial SERS survey started by HDB in 2001. The last SERS survey released in 2013 polled 628 households (across five projects), showing 87 per cent support for the scheme.

Then, almost all households interviewed (97 per cent) had lived in three-room flats or four-room (50 per cent and 47 per cent respectively) before the SERS exercises, but many subsequently upgraded to bigger replacement flats, with seven in 10 now residing in four- and five-room units (61 per cent and 10 per cent respectively).

CORRECTION: In an earlier version of this report, we said almost all households interviewed in the SERS survey released in 2013 lived in three-room flats or smaller. It should be three-room and four-room flats. We are sorry for the error. http://www.todayonline.com/singapore...lawerence-wong

[Arcachon]

http://eresources.nlb.gov.sg/newspap...9640212-1.2.87

[Arcachon]

3. Resale Market

Up till 1971, there was no resale market for HDB apartments. If an owner wished to sell his
apartment he had to do so directly to the HDB. The HDB would purchase the apartment at ‘the
original purchase price in addition to the depreciated cost of improvements’.

In 1971, the HDB created a resale market for its apartments. Owners were able to sell their units at
market price to buyers of their choice if they had fulfilled the minimum occupation period. Only
citizens who did not own any other residential property, had a minimum household size of two
persons forming a ‘family unit’, and with household incomes below a stipulated income ceiling, were
eligible to purchase new or resale HDB flats.

In 1989, the income ceiling restriction was removed from HDB resale flats; the resale market was
also opened to permanent residents as well as private property owners. HDB flat-owners could now
also invest in private sector built dwellings. Single citizens above the age of 35 have also been
allowed to purchase HDB resale apartments since 1991.

https://lkyspp.nus.edu.sg/wp-content...-Singapore.pdf

[Arcachon]

In 2014, Minster Khaw also announced changes to the resale processes which shifted negotiations
over price away from COVs. Firstly, HDB announced that it will publish daily prices of resale
transactions as soon as they are registered, instead of fortnightly after the resale transactions are
approved. Secondly, HDB will only accept valuation requests from resale flat buyers after the buyers
have been granted an Option to Purchase (OTP) by the seller.

These changes were aimed at getting flat buyers and sellers to negotiate based on recently transacted
prices, rather than base their negotiations off COVs, which had become a point of public contention.

https://lkyspp.nus.edu.sg/wp-content...-Singapore.pdf

[Amber Woods]

Expect more people selling their aging HDB flats since prices are still high. Prices for HDB resale flats are likely to fall further from here.

[teddybear]

You can change "HDB flats" to "99-years leasehold properties" AND they will still apply:

Expect more people selling their aging 99-years leasehold properties since prices are still high. Prices for aging 99-years leasehold properties are likely to fall further from here.

Expect more people selling their aging HDB flats since prices are still high. Prices for HDB resale flats are likely to fall further from here.

[Kelonguni]

Are you really clueless why MND makes this kind of announcement?

HDB Sers depends on Govt decisions but private en bloc depends only on the private owners decisions. For sure the price can still be worked out. At worst en bloc at huge discounts to FH land, LH will still have takers. Still can cover most of today capital and buy a new property.

Some of those HDB waiting SERS will have to pray hard or hope that there is potential for further intensity in resettling. Mostly can forget it if don't meet criteria.

You can change "HDB flats" to "99-years leasehold properties" AND they will still apply:

Expect more people selling their aging 99-years leasehold properties since prices are still high. Prices for aging 99-years leasehold properties are likely to fall further from here.

[Amber Woods]

You can change "HDB flats" to "99-years leasehold properties" AND they will still apply:

Expect more people selling their aging 99-years leasehold properties since prices are still high. Prices for aging 99-years leasehold properties are likely to fall further from here.

With HDB resale price falling, private property prices will also fall especially those in OCR and RCR regardless of freehold or leasehold.

[Kelonguni]

With HDB resale price falling, private property prices will also fall especially those in OCR and RCR regardless of freehold or leasehold.

Then where do the people who sold go to live? Not all can buy BTO again or like to wait many years.

[Amber Woods]

With HDB resale price falling, private property prices will also fall especially those in OCR and RCR regardless of freehold or leasehold.

If HDB flat prices fall, private property prices will also fall especially mass market condo. The two markets are. closely related.

[Kelonguni]

If HDB flat prices fall, private property prices will also fall especially mass market condo. The two markets are. closely related.

It depends on what those who sell intend to do with the gains. Sell and move in to relatives' house? Sleep in Changi airport?

If this increases supply of resales HDB but also increases demand for private property, we know what will happen.

[Amber Woods]

If HDB flat prices fall, private property prices will also fall especially mass market condo. The two markets are. closely related.

It is simple logic that when prices fall, you sell low and you will have lower budget to buy and hence overall prices will also fall.

[Kelonguni]

It is simple logic that when prices fall, you sell low and you will have lower budget to buy and hence overall prices will also fall.

When you sell a HDB, the minimum profit plus amount already put into HDB mortgage is minimum 200K to 400K. With 80% loan, they can reach out to minimum 900K or 1mil if they have income.

Not enough?

[Amber Woods]

Market forces will prevail.

[Kelonguni]

HDB and private policy intents are wholly different.

[henryhk]

Market forces will prevail.

Freehold properties still more safe in the Long run, especially now each purchase got so many restrictions and costs...... and Hdb near mrt got more chance to enblock, but hdb everybody is at stake, so just let it be

[Arcachon]

Facts and figures will decide up or down.

Bought 5 room HDB in 1995 for 250,000. (SGD 225,600 + 10% levy)

Lease start 1 July 1997.

http://www.propertyguru.com.sg/singa...istings/sale/1



Now selling at SGD 650,000 Valuation Price: S$ 632,000.

Rental at SGD 2800.

http://www.propertyguru.com.sg/singa...istings/rent/1

2017 - 1997 = 20. lease balance 79 years

79 x 12 x 2800=SGD 2,654,400.

Don't know selling at the above price can drop by how much.

[Arcachon]

Someone actually messages me about selling her HDB after reading the News.

After I explain to her the reason for MND to say after 99 years HDB is Zero value is not about HDB 99 years going to zero value but HDB unable to control the selling price after they allow valuation to follow selling price start on 10 Mar 2014.

Before 10 Mar 2014, HDB determines the valuation price and buyer and seller decide the COV.

After 10 Mar 2014, Seller and buyer decide the selling price and HDB allow valuator to match the valuation price.

Moving forward when more seller know the valuation is going to match the selling price, your guess is as good as mine.

[Kelonguni]

The strategy is old school and really works, but nowadays young people do not like hassle of dealing with tenants. The number of units eligible for rent will also be going up with a huge number meeting MOP, coinciding with EC buyers and ABSD remission timeframes. Other restrictions as well.

But HDB pricing is well supported with the grants. It's just that without the SERS route, some of the older resales may not be that viable.

Facts and figures will decide up or down.

Bought 5 room HDB in 1995 for 250,000. (SGD 225,600 + 10% levy)

Lease start 1 July 1997.

http://www.propertyguru.com.sg/singa...istings/sale/1



Now selling at SGD 650,000 Valuation Price: S$ 632,000.

Rental at SGD 2800.

http://www.propertyguru.com.sg/singa...istings/rent/1

2017 - 1997 = 20. lease balance 79 years

79 x 12 x 2800=SGD 2,654,400.

Don't know selling at the above price can drop by how much.

[Arcachon]

http://www.propertyguru.com.sg/singa...roperty_type=L

3 years balance lease selling for SGD 280,000.

[Tomutomi]

Walao asking price 170K with rental yield only 12%, expired in less than 4 years. The right price should be around 50K lah lol

[Arcachon]

http://www.propertyguru.com.sg/listi...=ls%7C%7C4%7C1

This one better.

[Kelonguni]

https://www.99.co/blog/singapore/lea...erty-99-years/

HDB no recourse if not chosen for SERS.

[Arcachon]

https://www.99.co/blog/singapore/lea...erty-99-years/

HDB no recourse if not chosen for SERS.

HDB, DBSS or private, 99 years leasehold are the same.

The only different is one (HDB or DBSS) is leasing the air space (leasing title), the other (Private, EC) is leasing a piece of the land (Strata Title).

When the government develops the infrastructure around the land. HDB don't benefit as much because HDB leasee cannot sell the land to the developer to top up the land lease whereas Private can sell the Land to the developer who then subject to SLA or URA approval to top up the lease.

HUDC non-private is the same as HDB but once private become Strata tiltle.

Several privatised Housing and Urban Development Company (HUDC) estates have been successfully sold en bloc so far. These are:

1) SHUNFU VILLE

Chinese developer Qingjian Realty made its debut purchase in the en bloc market when it snapped up the former HUDC estate Shunfu Ville in Bishan for $638 million in May 2016. The sale was this year’s first and Singapore’s largest en bloc deal in nine years since Farrer Court. Owners of the 358-unit estate pocketed around S$1.78 million each - a 50 per cent premium over a typical unit’s price.

2) FARRER COURT

The 618-unit development remains the priciest en bloc deal by quantum to date. It went for about $1.34 billion in June 2007. The D'Leedon by CapitaLand current sits on the plot of land.

3) GILLMAN HEIGHTS

Now The Interlace by CapitaLand, the 607-unit development went for $548 million in February 2007.

4) WATERFRONT VIEW

The 583-unit development was sold for $385 million in May 2006. Currently four condos stand in its place: Waterfront Waves, Waterfront Key, Waterfront Gold and Waterfront Isle.

5) MINTON RISE

Back in January 2007, the 342-unit development went for $209 million. Today, a new condo called the Minton by Kheng Leong, occupies the plot of land.

6) AMBERVILLE

Far East Organisation paid $183 million for the the 168-unit development in January 2006. Far East has since built the Silversea condo on the plot of land.

SINGAPORE — The Hougang Avenue 2 HUDC Estate has been privatised under the Land Titles (Strata) Act, paving the way for a collective sale of the 336 homes, although analysts said the chances of an en bloc deal would be slim in the near future.

The HUDC Estate, comprising Blocks 713 to 720 in Hougang Avenue 2,had obtained the required 75 per cent majority support for privatisation, said the Housing and Development Board (HDB) yesterday. Mr Nicholas Mak, Executive Director of Research and Consultancy at property firm SLP International, noted that, among the 18 HUDC estates, only five had successfully been sold collectively.

“Currently, the owners of the privatised HUDC estate Eunosville are trying to sell the property collectively, but there are no takers yet. One of the reasons is that some HUDC estates are too large for most developers to digest,” he said.

“The land area of the HUDC estate in Hougang Avenue 2 is about the same size as that of Eunosville. In the current property market, it will be challenging for the Hougang Avenue 2 HUDC estate to be sold collectively at a price that is high enough to satisfy all the owners.”

Mr Ku Swee Yong, Chief Executive of property agency Century 21,also warned that the size of the development might be a hindrance, saying that “today’s market is a bit more restricted to en bloc deals of around S$100 million because developers are more cautious about the outlook”.

The Hougang Avenue 2 HUDC Estate is the 15th of 18 HUDC estates to be privatised, said the HDB. Of the remaining three HUDC estates, Hougang Avenue 7 and Potong Pasir had obtained the mandate and are currently undergoing privatisation, while Braddell View is currently garnering support for privatisation, added the HDB.

[Arcachon]

http://hudcsingapore.com/hudc/what-i...ent-bill-2012/

10. To implement this option, the Braddell View residents will need to pay a premium to top up the lease term for the land parcel with the shorter lease so as to align its terminal date with the lease of the other parcel. The Chief Valuer will assess this lease top-up premium. The privatisation of the Braddell View Estate can then be effected through the transfer of the common property and its residual interest in the housing estate by HDB to the owners of all flats in the Braddell View Estate after the HDB obtains a topping-up of the lease for the Estate. Process-wise, the Braddell View body corporate will levy contributions on the flat owners who are the sub-lessees of HDB to cover the lease top-up premium, and pay over to HDB, being the lessor under head State leases, as part of the costs for privatisation before the legal documentation for the estate’s privatisation are lodged with the Land Registry.

Question, when HDB was formed why was the running of the estate not given to the resident.

https://data.gov.sg/dataset/resale-f...3-29bee150a6fe

[Kelonguni]

HDB leases: Buyers’ short-term focus may lead to future woes


BY
VALERIE KOH
[email protected]ISHED: 4:00 AM, MARCH 28, 2017UPDATED: 11:24 AM, MARCH 28, 2017
SINGAPORE — It may serve as a “wake-up call” to buyers that not all old flats will be eligible for the Selective En bloc Redevelopment Scheme (Sers), as National Development Minister Lawrence Wong reminded Singaporeans last week in a blog post.

But analysts believe the warning may go unheeded for the time being because the mindset of buyers is different today: They are looking to buy a Housing and Development Board (HDB) flat and sell it off within five to 10 years, in contrast to the previous generation which generally bought flats with the intention of living in them for decades.

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Such a mindset could account for why buyers are paying high prices for resale flats in mature estates. After all, most, if not all, the older HDB flats have at least 40 years of the 99-year lease remaining, and there is still a resale value. However, it could become a problem if the trend continues in the years ahead, the analysts said.

When it comes to the prices of properties nearing the end of their lease, it is not a straight-line depreciation, the analysts cautioned. In fact, once the lease of a property — be it a HDB resale flat or a condominium unit — falls below 30 years, prices which they could command would go down drastically, they noted.

In response to queries, the HDB said that as of December last year, there were a total of about one million flats in Singapore. Among these, about 7 per cent were at least 40 years old. Another 29 per cent were between 30 and 40 years old.

In his blog post, Mr Wong noted that only 4 per cent of HDB flats have been earmarked for Sers since its launch in 1995. “For the vast majority of HDB flats, the leases will eventually run out, and the flats will be returned to HDB, who will in turn have to surrender the land to the State,” he wrote.

Public servant Mavis Lim, 29, who has been looking for a resale flat in Bishan, told TODAY that the remaining lease of a flat has little influence on her decision. “Units in mature estates have more amenities nearby, and I would definitely prefer them even though they are older,” she said.

Mr Yosua Ng, a 29-year-old operations manager, said that while the lease of the flat would not be a deal breaker, it would factor into his price negotiations.

Singapore’s oldest estates include Queenstown, Tanjong Pagar and Bedok South, said Mr Chris Koh, director of property firm Chris International. He said that many young couples pay top dollar for older flats in the mature estates because of the amenities nearby and the relatively larger size, compared to new flats.

“(The buyers) are not thinking long-term. They buy it today ... But they have plans to upgrade further,” he said. In light of the country’s ageing population, many couples also end up moving after a few years in order to stay near their parents, he added.

Director of International Property Advisor Ku Swee Yong reiterated that the market value of older flats will fall in tandem with the lease duration. HDB loans and the use of Central Provident Fund are restricted for buying flats with less than 60 years left on their lease. “In the last 30 years (of the lease), only buyers with enough cash will be willing to buy. Then the value (of the flat) drops very quickly,” he said.

The analysts stressed that buyers cannot expect the Government to “save” them using taxpayers’ money through Sers, and the situation is no different from the private property market. For condominiums, it is already a given that the Government will not renew the lease “for free”, said SLP International Property Consultants’ head of research and consultancy Nicholas Mak. “What Mr Wong said is a wake-up call … to get people to not overpay for a flat,” he said.

Mr Wong’s comments triggered a spirited discussion online, with some expressing concern that flat owners whose leases are running out will have their homes taken back and be left in the lurch. Mr Mak suggested that when the time comes, these owners could be offered new units in a scheme that is similar to Sers, except that the owners will have to pay more for their new homes. VALERIE KOH

[Arcachon]

Willing Buyer, willing Seller.

99 years 60 years 30 years if you let the Buyer and Seller decide sure go only one way. Their way not the other way.

A mistake is a mistake, can talk until the Cow come home it is still a calibrated mistake to let the Buyer and Seller decide the selling price.

Since 10 Mar 2014, did HDB price become cheaper?

http://www20.hdb.gov.sg/fi10/fi10296...0?OpenDocument