AS THE LEASE RUNS DOWN
As is the case for all 99-year leasehold properties in Singapore, the clock is ticking. Mr Soh’s flat has 48 years left on its lease, while Mr Tan’s has 47.
The government has explained that the 99-year-lease is needed to enable the recycling of land so flats can be built for future generations.
On what happens when the lease expires, then National Development Minister Lawrence Wong said in 2017 that for the vast majority of HDB flats, they will be returned to HDB who will in turn have to surrender the land to the government.
As the leases decay, the flat prices will come down correspondingly, he said.
Mr Wong, who is now the Prime Minister, was responding in a blog post to an article by Chinese newspaper Lianhe Zaobao on March 15, 2017 on the high transaction prices in ageing estates, such as the Tiong Bahru former SIT flats.
Despite this, there are other ways for homeowners to unlock the value of ageing flats, such as through HDB’s lease buyback scheme. The government has also announced the Voluntary Early Redevelopment Scheme (VERS), which allow older HDB flats to be redeveloped before their leases expire, but only if owners agree.
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