SINGAPORE: Minister for National Development Lawrence Wong said on Friday (Mar 24) that he was "concerned" over the idea that some home buyers in Singapore were forking out high prices for older public flats expecting to benefit from the Selective En bloc Redevelopment Scheme (SERS).
Responding to an article by Chinese daily Lianhe Zaobao highlighting high prices of several short-lease Housing Development Board (HDB) flats in the resale market, the minister wrote in a blog post: "SERS, as the name implies, is on a selective basis. It is only offered to HDB blocks located in sites with high redevelopment potential. These are typically sites where the land has not been well utilised. It is also subject to the availability of suitable replacement sites for residents and the Government’s financial resources," he said.
"So please do not assume that all old HDB flats will be automatically eligible for SERS."
Mr Wong said only four per cent of HDB flats have been identified for SERS since it was launched in 1995 and authorities continue to maintain strict selection criteria for the scheme.
He also pointed out that when the leases for HDB flats run out, they have to be returned to the state eventually and that as flats near the end of their lease periods, their prices come down correspondingly.
"Buyers need to do their due diligence and be realistic when buying flats with short leases. This is especially important for young couples, who have to plan for a much longer future."
The National Development Minister encouraged first-time home-buyers to choose resale flats with sufficiently long leases to cover their needs.
As a guide, flats with leases that cover homeowners until they are 95 years old would give most people peace of mind until their golden years, he said, adding: "Over time, we can expect a more diverse HDB resale market, with flats of varying leases to cater to the different life-cycle needs of Singaporeans."