Will my HDB flat be worth $0 when the lease expires?

[awhtc]

Will my HDB flat be worth $0 when the lease expires?

Probably one of the biggest questions most HDB buyers have is: What happens when the 99-year lease is up? Does it just go down to zero? Or will you have an option of extending the lease?

A recent discussion on Reddit focused on this very question and on some possible alternatives. It's an especially pertinent question at this point in 2022, with resale flat prices at record highs, and no less than 259 flats selling for $1 million or more last year. Have Singaporeans truly processed the significance of the 99-year lease limit; and is there a better way?

https://www.asiaone.com/money/will-my-hdb-flat-be-worth-0-when-lease-expires

[1fast1]

Frankly, if the gahmen artificially props up the value of these expired-lease HDBs to win votes using taxpayer funds, I will be seething at them.

Edited February 13, 2022 by Turboflat4

[macrosszero]

That’s exactly what the G has actually been warning the people, in a feeble attempt to rein in soaring prices, but it is falling on deaf ears with brains between them hoping they would get the en-bloc windfall like many before them.

As the Chinese saying goes, you don’t drop tears till you see the coffin, and when the first of the 99 year flats goes, and occupants (rightfully) evicted, that people will realize it is very real.

[13177]

4 minutes ago, Macrosszero said:

That’s exactly what the G has actually been warning the people, in a feeble attempt to rein in soaring prices, but it is falling on deaf ears with brains between them hoping they would get the en-bloc windfall like many before them.

As the Chinese saying goes, you don’t drop tears till you see the coffin, and when the first of the 99 year flats goes, and occupants (rightfully) evicted, that people will realize it is very real.

Too many old flats around, how to en-bloc them? Lol. And many people even when they buy their resale flat when the flat is 30 year old, after they have stay for 10 years or more, the flat also become old old flat. So many people cannot escape the fact of their flat becoming old flat la.

[macrosszero]

1 minute ago, 13177 said:

Too many old flats around, how to en-bloc them? Lol. And many people even when they buy their resale flat when the flat is 30 year old, after they have stay for 10 years or more, the flat also become old old flat. So many people cannot escape the fact of their flat becoming old flat la.

It is actually to the G’s 10m goal’s interest that these old flats are redeveloped because the older flats are not space-efficient from a packing-them-in-like-sardines standpoint, the blocks are too far apart, open air carparks are a waste of space, and everything is too short to take full advantage of plot ratio. Or revenue efficient in converting a public housing plot into a private condominium plot for beaucoup revenue……

[t0y0ta]

HDB is to buy for having roof over one's little head.

Who came out with idea of flat as asset with $$ value to make peasants feel shiok? hint: starts with G

[Rayleigh]

But they were promised asset enhancement. 🤣🤣🤣

[13177]

9 minutes ago, Macrosszero said:

It is actually to the G’s 10m goal’s interest that these old flats are redeveloped because the older flats are not space-efficient from a packing-them-in-like-sardines standpoint, the blocks are too far apart, open air carparks are a waste of space, and everything is too short to take full advantage of plot ratio. Or revenue efficient in converting a public housing plot into a private condominium plot for beaucoup revenue……

But there are simply too many of such flats built, how could G able to enbloc all of them even they want to? Lol. Seems like they are now more interested to open up vacant land and forested area to build new BTO instead. You see the last enbloc project was 4 years ago.

[Fcw75]

5 minutes ago, t0y0ta said:

HDB is to buy for having roof over one's little head.

Who came out with idea of flat as asset with $$ value to make peasants feel shiok? hint: starts with G

G or P? 😁

[macrosszero]

7 minutes ago, 13177 said:

But there are simply too many of such flats built, how could G able to enbloc all of them even they want to? Lol. Seems like they are now more interested to open up vacant land and forested area to build new BTO instead. You see the last enbloc project was 4 years ago.

Fair point, especially the bit about the last SERS exercise, but what I observed is that HDB tends to re-insert existing residents into nearby new developments and sells the remainder as BTO. At this point with the labour crunch it is probably easier to cut trees down than demolish apartment blocks though.

[13177]

4 minutes ago, Macrosszero said:

Fair point, especially the bit about the last SERS exercise, but what I observed is that HDB tends to re-insert existing residents into nearby new developments and sells the remainder as BTO. At this point with the labour crunch it is probably easier to cut trees down than demolish apartment blocks though.

True, due to labour crunch and covid, dont think there will have any SERS project coming any time soon. Even now building new BTOs also have problem getting them complete fast. 

Edited February 13, 2022 by 13177

[Ct3833]

 this is not a HDB only problem but any 99 years leased hold properties, be it HDBs, condos or landed, the property value will reduce to ash when it reaches 99 years.  But this is not the concerns of the current government during their tenure because it will take many many more GE to come before the government then will face the problem. By then , what the government have to do is to extend the lease of the old flat for another 20 years or 30 years as long as the main structure could last, then leave the problem to others in the future. No one want to be the bad guy or lose votes. 🤣  

[Atonchia]

1 hour ago, 13177 said:

Too many old flats around, how to en-bloc them? Lol. And many people even when they buy their resale flat when the flat is 30 year old, after they have stay for 10 years or more, the flat also become old old flat. So many people cannot escape the fact of their flat becoming old flat la.

Got one easy way.

Renew the lease for those still want to stay put only 30 years

No need to rebuild.

Just pay the current BTO rate PSF for with a discount because Gov no need to rebuild. 

[Atonchia]

Same MOP applies

[Nolicense]

simply a demand supply issue. 99 years up and no residual value when hdb take back? well then the total stock of housing drops and prices stay up. that will bring down resale value but the gahmen still wins since bto is still a cash cow.

turn up the tap of immigration, that will prop up demand and prices.

need to signal to the market that prices will remain up? slow the pipeline of land and projects coming up, move the supply curve up.

cool the property market? well just collect more money since the higher prices dont stop people bidding up, just add absd.

99 year lease is never a problem, its just that the people are the players rolling the dice. ching keh still wins in the end.

 

[1fast1]

3 minutes ago, Nolicense said:

simply a demand supply issue. 99 years up and no residual value when hdb take back? well then the total stock of housing drops and prices stay up. that will bring down resale value but the gahmen still wins since bto is still a cash cow.

turn up the tap of immigration, that will prop up demand and prices.

need to signal to the market that prices will remain up? slow the pipeline of land and projects coming up, move the supply curve up.

cool the property market? well just collect more money since the higher prices dont stop people bidding up, just add absd.

99 year lease is never a problem, its just that the people are the players rolling the dice. ching keh still wins in the end.

 

 

[awhtc]

The HDB property scene is going to see plenty of turbulence in 10-20 years due to the decaying lease issue.

[Karoon]

28 minutes ago, awhtc said:

The HDB property scene is going to see plenty of turbulence in 10-20 years due to the decaying lease issue.

Nah... Its a game of musical chairs + kick the can down the road.

20 years back while looking for my first flat people were saying govt sure give money back after 99 years.

After 10 years its 'prices will drop after 30 years mark'

Now its 'prices will drop after 50 years mark'

In the meantime everyone and their uncle try to sell their flat at $1m.