Friday 21 August 2015

2-Room Flexi scheme: More flexible HDB flat options for elderly buyers

40% of flats set aside for seniors; studio apartment lease can be extended
By Yeo Sam Jo, The Straits Times, 20 Aug 2015

Elderly flat buyers will have a good number of units allocated to them under a new flexible housing scheme, which will also allow existing studio apartment owners to top up their leases.

At least 40 per cent of the flats under the new Two-Room Flexi scheme in each Build-to-Order (BTO) project will be set aside for those aged 55 and above.

This quota will be subject to a minimum of 100 units in each project, to ensure "adequate supply" for the elderly, said the Housing Board yesterday.

Under the scheme which kicks off next month, existing studio apartment owners, including those who have not collected their keys, can opt to top up their current 30-year lease by five, 10 or 15 years at any time. They can do so from April next year, at prevailing market rates. Alternatively, they can apply for a 10-year extension when their current lease expires.

Elderly buyers waiting for their new flats or studio apartments to be completed can cancel their applications and apply for a flat with a shorter lease instead. Any forfeiture fee will be waived if they do so before Aug 19 next year.

The new scheme, which takes effect from next month's BTO launch, merges and replaces the current studio apartment and two-room flat schemes.

It allows applicants aged 55 and above to choose units with shorter leases ranging 15 to 45 years, in five-year intervals. The lease they choose must last them and their spouse till they are at least 95.

First- and second-timer families and first-timer singles will continue to be offered the usual 99-year-lease flats.

Currently, studio apartments are meant for elderly home owners who have sold a previous flat to fund their retirement. These have a 30-year lease and are for those aged at least 55.

Two-room flats come with a 99-year lease and are meant for families or singles. Both flat types come in 36 sq m or 45 sq m sizes.

The HDB said it will launch over 70 BTO projects with Two-Room Flexi flats over the next five years.

Generally, a first-timer family eligible for housing grants can expect to pay about $50,000 for a 99-year-lease flat under this scheme, and $16,700 for a 15-year-lease unit.

The shorter-lease homes will be fitted with elder-friendly features such as grab bars.

Like studio apartments, these shorter-lease flats will be available to private property owners or those who have previously enjoyed housing subsidies. Flats with shorter leases cannot be sublet or sold on the open market.

Experts said the scheme lives up to its name by being flexible.

But ERA Realty's Mr Eugene Lim said the price methodology could be made clearer. He said: "Given that there are many lengths of leases available for the elderly, perhaps there should be some explanation as to how the prices of flats with shorter tenures are derived."

Seniors buying Flexi flats can choose fittings too
'Move-in condition' units with shorter leases, for those aged 55 and above, will cost extra
By Yeo Sam Jo, The Straits Times, 20 Aug 2015

Seniors buying homes under the Housing Board's new Two-Room Flexi scheme will not only get to choose their lease lengths but also the fittings in their flats.

The units with shorter leases, which are available only to those aged 55 and above, can come in "move-in condition", at an extra cost. This means they will have features such as lights, window grilles, built-in kitchen cabinets, gas hobs and water heaters.

Applicants - including non-seniors who can apply only for 99-year leases - can also opt for their homes to come with flooring and sanitary fittings, which include a wash basin and shower set.

The HDB said the costs of these options, which come under its Optional Component scheme, will be made known at each flat launch.

At May's Build-To-Order flat launch, flooring options for two- room flats cost about $2,000, while sanitary fittings cost about $300.

Flats with shorter leases will also come with elderly-friendly features such as grab bars. The cost of these will be factored into the flat price.

Applicants aged 55 and above can choose shorter leases ranging from 15 years to 45 years, in five-year intervals but they must choose a lease that will last them and their spouses until they are at least 95.

Second-timers aged 55 and above who sold their first subsidised flat before March 3, 2006 will also get more help when they buy a new two-room or three-room flat. Instead of paying the percentage resale levy with interest, the interest will be waived.

Sports trainer Paul Raguan, 57, and his 62-year-old wife plan to apply for a Two-Room Flexi flat with a shorter lease of about 40 years. "It's cheaper and we will have more savings for our retirement," he said.

Mr Raguan said the scheme's 40 per cent flat quota for elderly applicants will boost their chances. "We've balloted for a flat twice before but were rejected. Hopefully, our third time's the charm."

• For more information, call the HDB sales and resale customer service line on 1800-866-3066.

* Nine in 10 older buyers of HDB's two-room Flexi flats opt for shorter leases
For those aged 55 and above, 40-year lease for HDB's two-room flexi units is most popular
By Derek Wong, The Straits Times, 26 Feb 2018

Mr Yeoh Seh Dong, 69, had to give up his canteen-helper job three years ago because of poor health.

Surgery on his neck affected his movement and hearing, and he has had health issues since being diagnosed with nose cancer 12 years ago.

The loss of his income led Mr Yeoh and his wife, Madam Koh Kim Keow, 68, a cleaner, to decide to move from a five-room flat in Marsiling to a two-room flexi flat in Kampung Admiralty with a 30-year lease.

They did this under the Housing Board's two-room flexi scheme.

The HDB said yesterday that since the scheme was introduced in 2015, nine in 10 flat buyers aged 55 and above - or 5,070 out of 5,550 - have opted for shorter leases.

Seniors have booked 54 per cent of the total 10,230 two-room flexi units. Under the scheme, flats are offered with 99-year leases to families, singles and older applicants. But applicants who are 55 years and older can opt for leases of between 15 and 45 years.

The 40-year lease was the most popular, with 1,620 buyers. Only about 100 opted for the shortest lease of 15 years, with the oldest buyer being 95 years old at the point of application.

HDB stipulates that those 55 and older can take up a shorter lease as long as it covers the applicant and his spouse up to the age of at least 95.

Mr Nicholas Mak, executive director of property consultancy SLP International, said this requirement could explain why the 40-year lease is the most popular, as applicants past 55 ensure their lease extends until they are 95.

While circumstances led Mr Yeoh and Madam Koh to make the switch, they were happy to do so as it gave them more financial security, especially for Mr Yeoh's medical bills. He visits various specialists each month for his condition, but is not certain about the exact cost of the bill as it is mostly covered by insurance.

Besides, their three children, all in their 40s and married, had already moved out of their Marsiling flat for the most part of the past 20 years.

The couple bought their Kampung Admiralty flat for about $100,000, and spent about $10,000 renovating it. The Marsiling flat was sold for about $400,000, and the couple intend to keep the balance for their living expenses in their old age.

Mr Mak said such moves are in line with the aims of the scheme. "With this flexible shorter lease, the Government is encouraging the elderly not to put too much of their nest egg into an illiquid asset like real estate."

Even though Mr Yeoh and his wife miss the bigger space in their previous home and the sea view, they are happy with their new home, which they moved into last December.

Madam Koh said in Mandarin: "It is much quieter here in Admiralty, and we like the proximity to the MRT and amenities, and sheltered areas."

Mr Yeoh added: "The No. 1 thing here is the location."

They are also pleased with the elder-friendly grab bars in the home, which came fitted with the flat.

More two-room flexi flats will be launched in the May Build-To-Order project. This month, 657 such flats were made available in Choa Chu Kang, Geylang and Woodlands.

ERA Realty key executive officer Eugene Lim said: "Ultimately, the two-room flexi scheme aims to provide elderly flat buyers with a relatively cheap option to downsize, and, in this regard, it has delivered."

Joint Press Release by MND & HDB - Two-Room Flexi Scheme - Meeting Diverse Housing Needs

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