https://www.facebook.com/laoliang/posts/7611245978893247
The HDB 99-year lease few hundred billion dilemma?
I refer to Teo Kueh Liang’s letter “Your Say: Relook resale levy for long-time HDB owners who want to sell their first flats” (Today, May 3)
It states that “However, the flat’s value has depreciated as it is only about six decades away from its 99-year lease’s expiry.
Hence, the net sales proceeds of the flat would be substantially diminished, and if I factor in the resale levy, it will be a financial blow to me”
Comment:
What the writer has highlighted, may be just the tip of the iceberg
HDB flats that are over 40 years old may generally be declining in value, as the time left to the 99-year 0 value gets shorter
In 2020, there were 5,223 “Number of Approved Applications for (HDB) Financial Assistance Measures by Financial Year”
As there were 1,201,764 completed HDB flats (excluding DBSS & flats under construction) – if the average value of a HDB flat is say about $300,000 – are we possibly looking at about more than $300b of value which may eventually become valueless, at the end of their leases?
If we include the interest payable on mortgages – the sum may be even higher
Perhaps arguably, one way of looking at the issue, may be that even if one owner sells to another, and so on, – eventually someone may be holding on to it when the lease ends?
With just 78 Cumulative Number of Sites Under Selective En Bloc Redevelopment Scheme (SERS) since 1995, the bulk of HDB flats may become worthless, at the end of the day
