Friday, 18 July 2014

Parents may get incentives to join kids in newer towns

Idea raised as part of efforts to free up HDB flats in mature estates
By Rachel Au-Yong, The Straits Times, 17 Jul 2014

PARENTS may receive incentives to join their children in newer towns, in a bid to free up Housing Board flats in mature estates.

This would allow children who wish to join their parents in mature estates to have better chances of buying the freed-up flats, said National Development Minister Khaw Boon Wan.

It was heartwarming to see many families still wanting to live near each other, he added at a Tuesday night dialogue on housing issues.

More than half of young married couples here live with, or near, their parents, based on the latest survey commissioned by the Ministry of National Development which reached out to about 2,000 Singaporeans.

This proportion could grow, as eight in 10 young unmarried Singaporeans said they plan to live with or be close to their parents after marriage.

And the authorities want to help them, especially those who wish to live near each other in non-mature estates, said Mr Khaw.

"But for mature estates, it's a real problem for the simple reason that I just do not have the land available... What this means is that many will have to depend on resale flats," he said.

So if parents are prepared to leave their comfortable surroundings in a mature estate, "we should try to facilitate and perhaps even reward them for moving out, because that opens up opportunities for children of parents in mature estates who want to stay on."

He said his ministry will see how this can be made a practical and fair policy.

To further aid family bonding, more three-generation flats will also be built in mature estates, he pledged. Such flats, introduced last September to encourage multiple generations to live under one roof, are larger than a five-room unit.

The Government will also look to the Selective En bloc Redevelopment Scheme (SERS) to free up space in mature estates, said Mr Khaw.

Under this scheme, which aims to renew older public-housing estates, old flats are demolished and residents given the choice of moving to new flats elsewhere.

He pointed to some 3,400 flats in Queenstown that were recently slated for redevelopment.

"The footprint is large enough to build more than the flats that have to give way," he said, adding that many old flats are low-rise and a "poor use of land".

"This means we will have a surplus of a few thousand units, which will open up opportunities for children or parents to move in," he added.

Research analyst Sharon Woo, 27, who attended the Tuesday discussion, said the moves for parents to leave mature estates are welcome but not likely to be taken up by many.

Her parents, for example, live in Bishan and she did not think they would move out to join her and her fiance in Punggol when their flat is ready.

"There's a preference for mature estates, and the incentives will change only the minds of those on the fence," she said.

'Give $40k subsidy' to get parents to move
That is minimum needed to get them to join kids in newer towns: Analysts
By Rachel Au-Yong, The Straits Times, 21 Jul 2014

AT LEAST $40,000 in subsidies. Residents, analysts and agents believe that is the minimum needed to entice people living in mature towns to join their grown-up children in newer ones.

Even then, the take-up rate is unlikely to be high, they told The Straits Times, because it will be hard to convince parents to uproot themselves from familiar surroundings.

To strengthen family bonds, National Development Minister Khaw Boon Wan said last week that he would look into providing incentives for parents in mature estates to move out. This would allow children who wish to join their parents in mature estates to have a higher chance of buying the freed-up flats.

But even before the details have been rolled out, analysts and residents are lukewarm on the idea. For instance, office manager Lucy Kuah's eldest child lives in Sengkang, but the 59-year-old will not leave her four-room Bukit Merah flat to join him - with or without the incentive.

"My neighbours are not the noisy kind, and the hawkers at the market know me," she said. "Now, resale prices are going down, I'd better ask my son to come back here instead."

Real estate agents notice a reluctance to move, too.

"Most of the time, when people move out of mature estates, it's to upgrade to an executive condo or higher," said Dennis Wee Realty group director Dennis Foo, who focuses on Tampines.

"But even though I take them to nice areas like Punggol or Sengkang, they don't really bite. They still feel like Tampines is home."

If the Government plans on having an incentive, it should be upwards of $40,000, said Mr Foo.

This would be about 10 per cent of the price of a new Build- To-Order (BTO) four-room flat.

It would match the $40,000 subsidy offered to first-timers who buy a resale flat near their parents or children.

Buyers of new flats do not get additional subsidies. But they have double or triple the number of chances at the ballot, should they live near or with their parents or married children.

Property analyst Chris Koh of Chris International thinks the proposed incentive should be as high as a $50,000 grant for parents who move into BTO flats in non-mature towns.

Many elderly parents may soon retire and have no more income, he said. A sizeable grant could help finance that new home.

But it also depends on whether they have reached their Central Provident Fund Minimum Sum, or whether the top-up requirement can be waived. Currently, Singaporeans aged 55 and above will have to top up their Retirement Account to meet their cohort's Minimum Sum with the proceeds of the sale.

"If you haven't reached the Minimum Sum, then all the potential profit won't be much of an incentive any more, since it can't be cash in hand," he added.

SLP International research head Nicholas Mak thinks a grant would be hard to administer, especially if the parents have bought a Housing Board flat twice. Currently, a Singaporean household which has already bought two units from the HDB is not eligible to apply for another flat.

Besides, any incentive would be "a bit like a baby bonus - it's not enough to convince people to have three, four children," he said.

But despite a general reluctance among residents to leave mature estates, at least one couple is willing to leave their Tampines home of 20 years to join their younger son in Bukit Panjang.

Officer Adnan Hajisirat, 55, said a $40,000 grant would be a "blessing" that can facilitate the move for him and his wife.

"Singapore is small, so there shouldn't be a problem meeting my friends and neighbours," he said. "But family is different. Family is more important."

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