We need to address the HDB “vanishing asset value” problem before it is too late for many Singaporeans?

I refer to the HDB’s reply “Various options for seniors to monetise HDB flats” (Straits Times, Apr 24) to Mr Ronnie Lim Ah Bee letter (Seniors facing problems selling old flats; April 3).

It states that “While there has been some softening of prices in the HDB resale market, the overall transaction volumes remain fairly stable. Last year, the median resale prices of four-room flats with less than 60 years’ lease remaining were $430,000 in the mature estates and $306,000 in the non-mature estates.

The sales proceeds are more than sufficient to cover the typical price of a new two-room flexi flat. Such a flat is currently priced at around $150,000 in the mature estates, and $90,000 in the non-mature estates, for a 40-year lease. The prices are lower for two-room flexi flats with shorter leases.”

As the median means that half of the four-room flats were transacted below $306,000 in the non-mature estates – why not give us the prices at say the 10th or 20th percentile too.

I searched in a property portal and found older four-room flats selling from $260,000.

Also, why only give the statistics for four-room flats? What about three-room flats?

I found three-room flats selling from $210,000.

So, if you sell your flat for $210,000 – then buy a two-room flexi for $90,000, and then have to put back $85,500 into your CPF Basic Retirement Sum – you may be left with just $34,500.

Is this how the decades of rhetoric on the “HDB asset enhancement policy” is supposed to work?

As to “For four-room flats in Toa Payoh, the price gap can be as high as 65 per cent, according to OrangeTee” – there is an urgent need for the HDB to review their policies, as the HDB flat may generally be the biggest asset of many Singaporeans.

This may be akin to a timebomb ticking faster by the day and growing bigger as more flats decline in value to zero at the end of their 99-year lease.

Leong Sze Hian