Minister Khaw Boon Wan Says 99-Year Lease HDB Flats Are Still Assets

Those who purchase a 50-year-old HDB flat today can still expect the value to increase in the next decade, declared Minister Khaw Boon Wan during a dialogue session with youths from Sembawang GRC.

Mr Khaw made the comment while attempting to debunk claims that HDB flats are not assets due to their 99-year lease on Sunday (2 Sep).

He went further by claiming that appreciation potential exists even for a 70-year-old flat, as a result of programmes introduced by the government.

99-year lease = not assets?

This housing debate was reignited after Prime Minister (PM) Lee Hsien Loong’s National Day Rally comments, where he stood by the 99-year lease policy.

He explained during the rally that the policy strikes a balance between practicality for current residents and fairness for future generations.

Several HDB-related programmes were also announced during the rally, such as HIP (Home Improvement Programme) II and VERS (Voluntary Early Redevelopment Scheme).

Slower appreciation rates

Mr Khaw also addressed several housing concerns during the dialogue.

Among those were the issue of a slower rate of appreciation, as compared to the past.

He explained that housing prices are closely tied to the rate of economical growth.

In the past, Singapore experienced periods of significant growth as it moved away from being a 3rd world country.

However, due to our current status as a mature economy, similar growth rates will be unlikely, but modest growth rates of 2-3% can still be expected.

2-3% of netizens appreciated the comments

Many netizens were upset with what Mr Khaw said, and took to Facebook to air their frustrations.

This netizen suggested saving Mr Khaw’s comments for the next decade, in case their 50-year-old flat “did not appreciate in value”.

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Another netizen was skeptical about Mr Khaw’s comments due to the difficulty involved in selling an old flat.

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This netizen suggested implementing a development charge in exchange for renewing the 99-year lease.

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Our government will definitely have an easier time if all Singaporeans thought along the same lines as this netizen.

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Still plenty to be grateful for

Regardless of the conditions of our HDB purchase, having a roof above our heads alone is pretty good a reason to be thankful for.

Speaking of which, Singapore has a home ownership rate of over 90%, which is an unparalleled statistic anywhere else in the world.

What do you think? Does limiting the period of ownership of our flats render it not a non-asset?

Or are there other ways to solve the problem of limited land space for housing in Singapore?

Featured image from Facebook.