I posted a comment from Jim Lion concerning the prospect that HDB flats will have no value at the end of the lease. This would destroy the savings of the HDB owner.
This post attracted 20,000 views in 24 hours. 100 people liked it and 30 people added their comment. Most of them expressed their dismay that they were misled by the PAP leaders.
One of the commenter asked for my views - what can be done to address this shocking state of affairs. I agreed to give my reply and I do it here.
First, allow me to share my personal story. In 1983, I bought a leasehold townhouse for $650,000. I could have spent 20% more and buy a freehold semi-detached house. The townhouse in the condo with facilities looked more suitable.
After a year, I started to worry about the 99 year lease. What would happen at the end of the lease? I asked my uncle for his view.
He said - at the end of 99 years, the government will take back your property. They will pay you $0 for the townhouse. You will be damned lucky that they do not ask you to demolish the townhouse, which would be very costly.
At that time, i had thought that a building would last for 200 years and will still be liveable after 99 years. I thought that it would be unfair for the government to take the building without paying any compensation to the owner.
Nevertheless, I accepted the fate that my big investment would be worth $0 at the end of the lease.
I lived in the townhouse for 12 years and rented it out for the next 20 years. The remaining lease is now less than 60 years. I could still sell it for $2.5 million on the market or twice of this sum, if the enbloc sale is successful.
What the PAP leaders, including Mr Lee KY said, was true. A property was a good investment. There is a caveat - provided you bought it earlier at a low price!
I emphatize with the dismay of seniors who now find it difficult to sell their aging HDB flats to realize cash and to downgrade to a smaller property.
it is mainly due to the cycle of the property market now. There are more sellers than buyers. Many foreigners have left Singapore due to the economic slowdown during the past two years. Business had been bad.
Many private properties are vacant. Rental rates have fallen sharply.
There is another reason. The current government policy made it difficult for aging HDB flats to be sold. There are restriction on who can buy the HDB flats and on the use of CPF savings to pay the mortgage for the flats. These restrictions have to be revised.
I will give views on a separate post.
To these seniors, I will give a few words of comfort. Be patient. There will be a solution. Your HDB flat is still a good investment, but it may not be as good as you had thought it to be. If you had bought it many years ago, you would still be able to sell it at a profit.
Wait for my next post, OK? But I need 100 likes before I write the next post, OK?
Tan Kin Lian
This post attracted 20,000 views in 24 hours. 100 people liked it and 30 people added their comment. Most of them expressed their dismay that they were misled by the PAP leaders.
One of the commenter asked for my views - what can be done to address this shocking state of affairs. I agreed to give my reply and I do it here.
First, allow me to share my personal story. In 1983, I bought a leasehold townhouse for $650,000. I could have spent 20% more and buy a freehold semi-detached house. The townhouse in the condo with facilities looked more suitable.
After a year, I started to worry about the 99 year lease. What would happen at the end of the lease? I asked my uncle for his view.
He said - at the end of 99 years, the government will take back your property. They will pay you $0 for the townhouse. You will be damned lucky that they do not ask you to demolish the townhouse, which would be very costly.
At that time, i had thought that a building would last for 200 years and will still be liveable after 99 years. I thought that it would be unfair for the government to take the building without paying any compensation to the owner.
Nevertheless, I accepted the fate that my big investment would be worth $0 at the end of the lease.
I lived in the townhouse for 12 years and rented it out for the next 20 years. The remaining lease is now less than 60 years. I could still sell it for $2.5 million on the market or twice of this sum, if the enbloc sale is successful.
What the PAP leaders, including Mr Lee KY said, was true. A property was a good investment. There is a caveat - provided you bought it earlier at a low price!
I emphatize with the dismay of seniors who now find it difficult to sell their aging HDB flats to realize cash and to downgrade to a smaller property.
it is mainly due to the cycle of the property market now. There are more sellers than buyers. Many foreigners have left Singapore due to the economic slowdown during the past two years. Business had been bad.
Many private properties are vacant. Rental rates have fallen sharply.
There is another reason. The current government policy made it difficult for aging HDB flats to be sold. There are restriction on who can buy the HDB flats and on the use of CPF savings to pay the mortgage for the flats. These restrictions have to be revised.
I will give views on a separate post.
To these seniors, I will give a few words of comfort. Be patient. There will be a solution. Your HDB flat is still a good investment, but it may not be as good as you had thought it to be. If you had bought it many years ago, you would still be able to sell it at a profit.
Wait for my next post, OK? But I need 100 likes before I write the next post, OK?
Tan Kin Lian
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