Thursday, 23 August 2018

Lease Buyback Scheme extended to all HDB flats from 1 January 2019; Government to seek feedback on new housing policy VERS

Govt looking into letting buyers use more of CPF for older, shorter-lease flats
By Rachel Au-Yong, Housing Correspondent, The Straits Times, 21 Aug 2018

Elderly owners in all Housing Board flats - even those in five-room flats or executive maisonettes - can soon sell a part of their lease to the Government and use that income to fund their retirement years.

The Government is also looking to update rules so that people can dip more freely into their Central Provident Fund (CPF) savings when they purchase older flats.

National Development Minister Lawrence Wong announced these moves in a blog post yesterday, a day after Prime Minister Lee Hsien Loong outlined the Ministry of National Development's (MND) plans to systematically upgrade older HDB flats. Residents in selected precincts may even get to vote on whether to take up the Government's offer to buy back their flats.

"These are long-term plans which will be implemented over several decades," noted Mr Wong. "Meanwhile, MND will be making several shorter-term moves to help seniors unlock the value of their HDB flats for retirement."

Previously, the Lease Buyback Scheme was restricted to four-room or smaller flats. But Mr Wong said that there are seniors who prefer to age in place. "This (move) will enable many more Singaporeans to benefit from the scheme," he said.

Currently, to qualify for the scheme, home owners must be at least 65 years old and have at least 20 years of lease to sell to HDB, among other eligibility conditions.

The current take-up rate is relatively low, with about 2,500 families benefiting as of Nov 30 last year, since the scheme was implemented in 2009. The average proceeds they received are about $146,000.

Mr Steven Choo, chairman of real estate advisory firm VestAsia Group, said the change is likely to make the scheme more attractive: "If you have a 30-year lease on a five-room flat, it can be quite a tidy sum. If you crave security, this is a good option."

But National University of Singapore real estate professor Sing Tien Foo does not expect the take-up rate to increase by much. "Those who own a bigger flat technically should have higher incomes and may not need to monetise as much as those from lower-income families. The number of people who will sell the remainder of their leases should be quite manageable - too many, and that would strain the HDB's budget."

Mr Wong's ministry is also looking into how to let buyers of shorter-lease flats use more of their CPF monies for their purchase, without compromising on their retirement savings. Improving the liquidity of the resale market for older flats, he added, would facilitate an elderly resident's move to a smaller unit.

Currently, CPF can be used for the purchase of older HDB flats, but is subject to certain restrictions which kick in when the remaining lease is less than 60 years. For example, a home owner can use his CPF money if his age plus the number of years left on the remaining lease of the property is at least 80 years, but that too is subject to certain restrictions.

No CPF money can be used if the remaining lease is less than 30 years.

"These rules are meant to ensure that buyers purchase a home for life, without compromising their retirement savings," he said. But he added that there is "scope to provide more flexibility for buyers of shorter-lease flats while safeguarding their retirement adequacy".

Mr Wong said the moves - the result of many months of intensive study - are "meant to prepare for the future responsibly".

* Lease Buyback Scheme extended to all HDB flats, including 5-room and larger units from 1 January 2019
Seniors living in five-room and larger flats can now sell part of remaining lease to HDB
By Rachel Au-Yong, Housing Correspondent, The Straits Times, 1 Jan 2019

Seniors living in five-room and larger flats will be able to sell part of their leases back to the Housing Board from today. This allows them to monetise their homes, while continuing to live there.

Previously, the Lease Buyback Scheme was available only to owners of four-room or smaller HDB flats.

All owners must reach the eligibility age, currently set at 65 years, before they can sell part of the lease back. They must have a gross monthly household income of $12,000 or less, with at least one of the owners being a Singaporean, and have at least 20 years of lease to sell. At the same time, they must keep a minimum of 15 to 30 years of lease, depending on their age.

As of November last year, about 34,000 families would benefit from extending the scheme to five-roomers, bringing the total number of eligible households to about 130,000, the HDB said in a statement today.

Among them is part-time security guard Tang Lum Sui, 68, a widower who lives alone in his Jalan Bahagia five-room flat and had petitioned his MP several times to have the scheme - rolled out in 2009 - extended to home owners like him.

"I don't want to move out of Toa Payoh because I have lived here all my life, and I like that my son's family (living in Qatar) can stay with me whenever they come back to Singapore," he said . Mr Tang, whose flat has 67 years left on the lease, added: "As long as the terms are favourable, I will go for it."

The extension was first announced by National Development Minister Lawrence Wong last August as part of the short-term measures to help the elderly unlock the value of their HDB flats for retirement.

On top of the proceeds they would receive from selling part of their remaining lease to the HDB, households living in larger flats will get an additional $5,000 bonus.

The HDB said those interested in the scheme can get personalised financial counselling so they can make informed choices. This includes going through the terms and conditions and a preliminary financial plan based on the estimated net proceeds sellers would get.

After selling part of their leases, owners must top up their Central Provident Fund (CPF) Retirement Accounts to the higher Full Retirement Sum for their age cohort if they are the sole owners, or to the Basic Retirement Sum if there are two or more owners.

After that, households may keep the next $100,000 in cash.

If there are proceeds leftover, owners have to top up their respective Retirement Accounts to the prevailing Full Retirement Sum before keeping the balance in cash.

At the counselling session, seniors will get an estimate of the monthly payouts from CPF Life which they can get if they sell their lease. HDB officers will also go through other monetisation options, such as renting out spare bedrooms to supplement seniors' retirement income and downsizing to a smaller flat, for which they can qualify for a Silver Housing Bonus of up to $20,000.

While the current take-up rate is relatively low - about 3,300 families have benefited to date - observers said the expansion will be especially appreciated by those who need it.

Nee Soon GRC MP Henry Kwek, who had urged the authorities to extend the scheme before, said: "The changes will help our seniors fund their retirement by tapping their housing equity, while retiring in the comfort of their own neighbourhood. I expect it to be well-received."

How it pans out for a couple aged 65
By Rachel Au-Yong, Housing Correspondent, The Straits Times, 1 Jan 2019

The Housing Board gave an example of how much a couple, who are both 65 years old, might get for their fully paid-up five-room flat.

With 65 years left on its lease, the flat is valued at $520,000.

Assume that the couple - say, a Mr and Mrs Lim - join the Lease Buyback Scheme (LBS) and keep 30 years of the lease. They sell the remaining 35 years to the Housing Board for $219,300.

As Mr and Mrs Lim are joint owners, they will receive an equal split of the sale proceeds, amounting to $109,650 each.

They will each use their share of the proceeds to top up their Central Provident Fund (CPF) Retirement Accounts (RA) to the Basic Retirement Sum, which is $88,000 for their cohort.

Mr Lim needs to top up $68,000 as he started with $20,000 in his RA, while Mrs Lim needs to top up $83,000 as she started with $5,000 in her RA.

Mr and Mrs Lim will receive the full cash bonus of $5,000 as their total CPF Retirement Account top-up exceeds $60,000.

After topping up, they have remaining proceeds of $68,300. They can keep all of this in cash.

In total, Mr and Mrs Lim will receive $73,300 in cash (including the LBS bonus of $5,000) and will also receive monthly payouts of $1,000 under CPF Life for the rest of their lives.

Lease Buyback Scheme gives elderly couple peace of mind financially
By Rachel Au-Yong, Housing Correspondent, The Straits Times, 21 Aug 2018

When former security officer Abdul Rahman Kemat sold more than half the remaining lease on his four-room flat to the Housing Board, he saw two benefits.

One, a good passive income on which he can retire.

Mr Abdul, 70, sold 46 years of his four-room Jurong West flat's lease - which had 81 years left at the time - to HDB for $144,000 two years ago.

He got about $36,000 in cash. The rest is being paid out through Central Provident Fund Life plans, which provide him and his wife a combined monthly payout of $1,000.

"I like that we don't have to worry too much about life," he said.

The other upside? "I don't have to live with my children," he joked.

He added that he enjoys having his own private space with his wife, and is grateful that the scheme allows his children to raise their families in their own ways.

He is among the some 2,500 families who have sold part of their leases to HDB for retirement income since the Lease Buyback Scheme was implemented in 2009.

Yesterday, Minister for National Development Lawrence Wong announced that the scheme would be expanded to those living in five-room and larger flats.

Another beneficiary of the scheme, retiree Koh Sai Choo, 69, said the move would give elderly people living in larger flats a chance to cash out.

Ms Koh, who is not married and lives alone in a four-room Tampines flat, said: "I have no children - so if I didn't sell, who would take care of me? It's good that other people in similar situations get the chance now."

In 2015, Ms Koh, who had 68 years left on her lease then, sold 38 years back to the HDB for about $200,000.

Not everyone, however, is enticed by the scheme.

Hawker Choo S.S., 66, who lives in a five-room Ang Mo Kio flat with his wife, said he finds it hard to "give up" his flat - even though their two grown-up children have their own homes.

"If I need the money for retirement, I would rather rent out a room, or get a smaller flat," he said.

"But I would still keep the flat, in case my wife or children need it for some reason," he said.

Lease Buyback Scheme allows seniors to get lifelong income
By Rachel Au-Yong, Housing Correspondent, The Straits Times, 21 Aug 2018

Introduced in 2009, the Lease Buyback Scheme allows elderly home owners to sell part of the lease of their flats back to the Housing Board for retirement income.

The scheme was initially only for three-room and smaller flats, but it was expanded in April 2015 to include four-room units.

Soon, all HDB flat types will be eligible. Details regarding implementation are being worked out, the Government said.

The flat owners, however, must be at least 65 years old, and have a combined household income of less than $12,000 a month. They must not own another property, and their flats must have at least 20 years of lease to sell to HDB.

For example, if a flat has 70 years of lease left and the owner wants to live there for another 30 years, he can sell the remaining 40-year lease, which HDB will buy at market rate.

The sale proceeds will be used to top up the owner's CPF Retirement Account.

The savings in the Retirement Account can be used to buy a CPF Life plan, which will give the owner a monthly income for life. Part of the proceeds can be withdrawn in cash, if the owner meets his Retirement Account requirements.

If the owner dies before the expiry of the 30-year lease, his family is paid for the remaining years.

Should owners outlive the length of their flats' remaining lease, the Government has assured them that appropriate housing arrangements would be made and they will not become homeless.

One key advantage of the Lease Buyback Scheme is that owners get to live in their homes while receiving a lifelong income.

The downside is that they have no property to bequeath their loved ones. They also have to forgo any gains should their flats' value appreciate.

Government to reach out to Singaporeans as it works out newly announced housing policies
They were announced early to give assurance of long-term plans for housing, says National Development Minister Lawrence Wong
By Ng Jun Sen, Political Correspondent, The Straits Times, 22 Aug 2018

While details of the newly announced housing polices are being worked out, the Government will reach out to Singaporeans to gather feedback and understand their concerns to fine-tune the policies, said National Development Minister Lawrence Wong yesterday evening.

Speaking to the media on the sidelines of a public forum at shopping mall Bugis+, Mr Wong said the Government understands that Singaporeans are worried and unsure about what to expect, and have raised questions about the future of public housing, particularly as the building stock gets older and approaches the end of lease.

A number of policies were announced early, said Mr Wong, to share the broad outline and road map over what people can expect about the future of housing.

In his National Day Rally speech on Sunday, Prime Minister Lee Hsien Loong announced a number of housing initiatives, including the new Voluntary Early Redevelopment Scheme (VERS), which will allow more owners of Housing Board flats to sell them en bloc to the state before the 99-year leases on their flats expire.

On Monday, the National Development Ministry also announced it is expanding the Lease Buyback Scheme to five-room and larger flats, while reviewing an easing of the rules for using Central Provident Fund savings to buy older flats.

Announcing these policies before the details are finalised is to give Singaporeans assurance of the long-term plans for housing, said Mr Wong, who is also the Second Minister for Finance. "There are a lot of implementation details to be worked out, so we are going to take this opportunity over the next few months or years to start engaging more groups of Singaporeans, understanding their concerns and getting feedback and ideas so that we can fine-tune and eventually work out the implementation details."

This applies to VERS, he said, as well as HDB's Home Improvement Programme (HIP) and HIP II, which will be launched when the first flats reach 60 to 70 years old about a decade from now, and the Lease Buyback Scheme and use of CPF funds for shorter-lease flats.

"We are talking about a whole gamut of issues around the next phase of public housing over which we want to engage Singaporeans. Some will be done sooner, because they will be shorter term in nature, but some we will take more time to flesh out and work through implementation details," he said, adding that it will be a major fiscal commitment.

On VERS, which will eventually replace the existing Selective En bloc Redevelopment Scheme (SERS) for redevelopment purposes, Mr Wong said there are still sites that will undergo SERS. The move will allow the authorities to progressively redevelop old estates over a longer period, instead of only when their leases expire.

In order to bring these programmes to fruition, he said they must be fiscally sustainable and the Ministry of Finance should be able to secure the monies for them.

"What this depends on is more than just about availability of funds... It is all of us working together, securing a strong, effective economy, good governance, and support for these long-term plans.

"If we have these prerequisites, then I think we will be able to ensure that the plans can translate into reality."

A 99-year leasehold flat is an owned asset, not a rental: Lawrence Wong
By Ng Jun Sen, Political Correspondent, The Straits Times, 22 Aug 2018

The value of a Housing Board flat sold on a 99-year lease will appreciate as the country prospers - a fundamental tenet of Singapore's home-ownership policy, said National Development Minister Lawrence Wong yesterday.

"There is a high likelihood that over a period of time, if the economy does well, if incomes rise, then property values will appreciate together with the fundamentals of the economy, and your stake in the nation - your home - can also appreciate in value," he said.

"And that is the fundamental tenet of our home-ownership policy - that we are giving every Singaporean a home and this is a tangible and concrete stake in the nation's success," he added.

Mr Wong was answering a question by a member of the public on the 99-year leasehold for HDB flats at a forum organised by government feedback unit Reach, on what people thought about Sunday's National Day Rally.

The forum was attended by around 120 audience members, who peppered Mr Wong and Reach chairman Sam Tan with questions on cost of living, housing and foreign affairs - topics central to Prime Minister Lee Hsien Loong's speech.

The first question of the night, by a Toa Payoh resident who identified himself as Mr Lu, touched on the issue of whether residents own, lease or rent their HDB homes.

Mr Lu asked if the Government should clarify that a 99-year lease is actually a form of long-term rental, and if it was thus misguided for residents to seek capital gains from their properties. Mr Wong said a 99-year lease is ownership, not a tenancy.

"When you buy a car, how long can you use a car ? Is it a rental car, or your car? A 99-year lease is far longer than 10 years. It is yours. It is an asset. It is owned by the home owner," he said.

Explaining further, he set out why residential properties, public or private, have been sold on 99-year leases by the Government since 1967.

"We are land-scarce in Singapore, we have constraints. If we give out and sell freehold land today, everyone who buys it will be very happy, and your children and whoever you pass your land to will be very happy, but eventually there will be those without land," said Mr Wong.

Hence, the limited leasehold terms allow Singapore to recycle land for the future. The properties may be on finite leases, but they will cover the housing needs of at least two generations, he added.

Mr Sam Tan, who is also Minister of State for Foreign Affairs and Social and Family Development, said good economic growth over decades has led to homes becoming assets.

"So long as we as a people and country work together to grow our economy and share in the wealth of growth, then our homes will be an important and valuable asset that we can use as a retirement nest egg," said Mr Tan.

To another question about the potentially divisive nature of the Voluntary Early Redevelopment Scheme (VERS) in which HDB residents will vote on whether to sell their flats en bloc, Mr Wong said the Government was aware of this, and was working on how to make the process less polarising.

He noted that HDB has had a lot of experience with polling residents and the process has generally been smooth.

"I think the concerns are real and I acknowledge that the stakes are higher, it is not just about upgrading of lifts or HIP (Home Improvement Programme), it is potentially more consequential. Stakes are higher," he said. "But we have time to work out the exact mechanism and how to go about doing it without causing too much divisions, creating acrimony within the block itself. We don't want that to happen."

An ideal mechanism for the voting process is one in which residents can have a collective say if Vers were to be offered. He said the Government would work out the details while bearing in mind these concerns.

Owners of older HDB flats split over VERS
Some in one of the oldest blocks here say they would vote yes, while others want to age in place
By Ng Jun Sen, Political Correspondent, The Straits Times, 21 Aug 2018

Madam Valentina Doss still remembers the smell of nearby pig farms at Block 1 Lorong 7 Toa Payoh five decades ago, where she has lived since she was 19.

It is not her fondest memory, said Madam Doss, now 68 and retired, but it reminds her of how she has grown with Toa Payoh.

As Block 1 is home to some of the oldest non-rental flats in Singapore, her ageing three-room flat is an example of a block that might be a candidate for the Voluntary Early Redevelopment Scheme (VERS). VERS was announced in this year's National Day Rally on Sunday.

VERS allows residents in selected precincts to vote on whether to sell their flats back to the Government early, after the flats have crossed the age of 70. It is part of a long-term plan to progressively redevelop older precincts.

Details of the scheme are still being worked out, but if VERS comes to Block 1, which is 50 years old and has 49 years left on the lease, Madam Doss will probably say no to moving out of her long-time home.

Said the former civil servant, who lives alone: "We have a community who have lived here for as long as I have. If the majority votes yes, I will feel sad to move, but I hope that it never comes to that."

Not all her neighbours may agree with Madam Doss if the matter is put to a vote. Out of 20 households at Block 1 interviewed yesterday, 10 would say no to VERS. Six households said they would vote yes, while four were undecided.

On one side is Madam Doss' view that there is little point in moving out of a perfectly good home. Several residents, such as taxi driver N. Govindaraju, 53, said moving house is disruptive to residents.

On the other side is the view that a collective sale at the 70-year mark would give residents a payout that can go towards paying for their next home or be passed on to their children, instead of allowing their home values to dwindle to naught at the end of the 99-year leases.

Nurse Razel Comeso, 46, who bought her flat seven years ago at $350,000, wants to be able to pass on an inheritance to her two children. Wholesale florist James Wong, in his 50s, wants to move before the onset of age-related maintenance issues.

This range of views will have to be grappled with in 20 years' time when a number of the oldest precincts in Singapore turn 70.

A precinct comprises of around 10 blocks of flats. Whether they favour VERS or not, residents ultimately gain from having the option of a government buyout before lease expiry, said Bishan-Toa Payoh GRC MP Saktiandi Supaat. Even if VERS does not proceed, residents can still expect ageing homes to receive upgrading and maintenance through other policies, such as the expanded Home Improvement Programme, he said.

"What is key here is that there is a choice for residents now," said Mr Saktiandi, a member of the Government Parliamentary Committee (GPC) for National Development.

For now, these new housing policies need to be explained to Singaporeans, he added.

Indeed, some residents had several misconceptions about VERS after Sunday's Rally. Several assumed that VERS is synonymous with the existing Selective En bloc Redevelopment Scheme (SERS), which the authorities use to take back public housing sites with high redevelopment potential.

One key difference is that the terms of compensation for VERS will be less generous than that for SERS, which is why VERS is voluntary. The authorities, however, will help VERS residents get another flat to live in.

Mr Chris Koh, director of real estate agency Chris International, said the VERS payouts should still enable residents to rent a home, purchase a two-room flexi flat or place a deposit on a new home.

Some, like National Development GPC chairman Alex Yam, had voiced concerns over possible acrimony between groups of residents when VERS is put to a vote - but those who live in Block 1 said that was unlikely.

Still, the financial upsides with VERS mean resident Joe Thang, 63, will do his part to educate his elderly neighbours - nicely - about the benefits of saying yes.

Said the retired businessman: "This is public housing so it is unreasonable to expect a windfall (from VERS) like you get with a condominium en bloc sale. But it is good financial sense to prevent your home value from turning to zero."

Helping HDB flats hold value: Use supply and demand moves
Redeveloping old estates will raise housing supply. But will population growth generate enough demand to maintain price levels, especially given gig economy workers' uncertain incomes?
By Vikram Khanna, Associate Editor, The Straits Times, 22 Aug 2018

Prime Minister Lee Hsien Loong's National Day Rally speech was welcomed for its focus on critical concerns relating to housing and health.

Economically, it laid to rest many uncertainties facing the occupants of ageing Housing Board (HDB) flats, as well as the elderly who are worried about healthcare costs. Politically, it was a master stroke for addressing concerns from the ground and coming up with practical solutions.

However, some of the solutions Mr Lee offered, while far-reaching, are partial: More needs to be done.

Let us consider the issue of housing. To recap on the positives: 230,000 homeowners stand to benefit from the extension of the Home Improvement Programme (HIP) to flats built between 1987 and 1997.

Owners of older HDB flats will be relieved to learn that their flats will be upgraded a second time when they reach 60 to 70 years, which is 30 to 40 years from the expiry of their 99-year leases - which would make them more liveable and more saleable.

Opportunities for redevelopment or sales en bloc - up to now largely the preserve of the private property market - will be extended to older HDB estates, with the introduction of the Voluntary Early Redevelopment Scheme (VERS).

The first precinct to be redeveloped under VERS is likely to be 20 years from now. This will widen the options for the residents of these estates - who would stand to get some compensation for redevelopment - as well as enable the renewal of Singapore's old housing stock to be spread out over 20 to 30 years instead of four to five, which is what would happen without a VERS scheme as clusters of similarly aged flats all reach their lease expiry dates around the same time.

But if, as Mr Lee suggested, the goal is also to help HDB flats retain their value, these moves - while necessary - are not likely to be sufficient.


This is because they are mainly focused on the supply side of the housing market: The measures are essentially aimed at improving, or at least maintaining, the quality of the housing stock over time. The proposed VERS would also have the effect of increasing the supply of housing; redevelopments are likely to result in more, not fewer, flats being built than the number reclaimed by the Government.

While this is good for urban renewal, if house prices are to remain stable or gradually rise over the long term, demand-side issues must also be addressed.

One of the key issues here is population.

The Monetary Authority of Singapore (MAS) Financial Stability Review of November 2017 flagged this issue. It noted that the compound annual growth rate of the population has declined, from 3.0 per cent between 2007 and 2012 to 1.1 per cent between 2012 and 2017.

It also sounded a note of caution on what is happening with housing supply. It pointed out that the redevelopment of sites en bloc - the sales of which have significantly picked up since 2017 - could, together with supply from government land sales sites, potentially add another 20,000 new private housing units. This will more than double the number of unsold units currently in the pipeline within the next one to two years.

The MAS report concluded: "With slower population growth, there is considerable uncertainty as to whether existing vacancies and the new supply coming on stream can be fully absorbed by the market. Should there be insufficient occupation demand for the completed housing units, a supply imbalance could result and place downward pressure on prices and rentals in the medium term."

While the MAS report was not looking beyond two years, it is clear from its conclusions that to ensure adequate demand over the medium and long term, Singapore needs population growth. This can be achieved by either a higher birth rate or by higher immigration.

The total fertility rate (the average number of children born per woman), which has been falling since 2014, was 1.16 last year, compared with a replacement rate (the rate required to maintain the population at a constant level) of 2.1. Raising this rate is an uphill task.

As MAS managing director Ravi Menon has pointed out, if there is zero net immigration, the resident working age population will start to decline from around 2020 - less than two years from now.


The Government recognises this problem, so it has carefully managed immigration levels to ensure the working population does not shrink.

As Minister in the Prime Minister's Office Josephine Teo said in Parliament in March, while discussing population strategy during the Committee of Supply debate: "At around the current rates of immigration, we are close to achieving the same effect as if we had full-replacement TFR. Therefore, we do not expect any major changes to our immigration policy presently. In other words, with a moderate level of immigration, we can prevent the citizen population from shrinking in the long term."

However, if the economy is to grow and property prices are to be maintained or rise - especially as supply increases - what we need is not a "non-shrinking" population, but a growing population.

Without that, Singapore will run up against problems of ageing and a rising dependency ratio - that is, the ratio of older dependants to the working age population.

Unless there is a big jump in productivity - which is difficult to achieve - this does not augur well for the demand for housing over the medium to long term: Older people are not big home buyers. Moreover, faced with having to fund their retirement, they are more likely to downgrade to smaller, cheaper properties, than to upgrade.

The greater use of the Lease Buyback Scheme (whereby residents of HDB flats can sell part of their lease back to the Government), which is to be extended to all HDB flats, will add further to the supply.

Thus, the potential shortfall in demand relative to supply will need to be addressed if house prices are to remain even stable, let alone increase.

Higher immigration to ensure a gradually rising population would be the best way to address the demand issue. A higher working population will also help expand the fiscal base - which will also be needed to help the Government fund its ambitious housing and healthcare plans.


Another trend that could impact the demand for housing is the changing nature of employment. One aspect of this is the rise of the "gig economy".

Rising numbers of people, especially the young, are opting for freelance work - whether out of choice or because that is how companies' hiring practices are evolving.

According to a report by Maybank Kim Eng last year, about 47 per cent of Institute of Technical Education , 35 per cent of polytechnic and 10 per cent of university graduates went into part-time, temporary or freelance jobs in 2016 - more than double the share from a decade earlier.

Currently, freelancers make up only around 9 per cent of Singapore's workforce. But this proportion could rise. A 2016 report by the McKinsey Global Institute found that 20 to 30 per cent of the combined workforce of the United States and Europe engaged in independent or freelance work over the previous 12 months.

In addition, given the pace of technological change and corporate disruption, workers of the future are likely to have multiple jobs during their careers - certainly more than past or current workers. They may also face more frequent spells of temporary unemployment.

This will affect property demand.

With workers' incomes likely to become less stable and more subject to uncertainty, it could also lead to more people choosing to be renters rather than buyers.

Future governments will be faced with the challenge of how to help stabilise peoples' lifetime income streams - whether through encouraging individual savings, some kind of unemployment insurance, or a variant of the universal basic income (whereby the Government guarantees a minimum income level for all), or some other means.

Thus, the focus on flat upgrading and redevelopment, while helpful and humane, can only go some way towards maintaining housing values. The Government will need to face up to the demand side of the equation squarely and address this candidly, rather than maintain a status quo that looks increasingly dubious as a viable strategy for the future. It will also need to address issues related to income security for future generations.

* Parliament: Wider upgrading on horizon while VERS details are ironed out

Thorough study being done on how to implement scheme: National Development Minister Lawrence Wong
By Rachel Au-Yong, Housing Correspondent, The Straits Times, 11 Sep 2018

Even as anticipation over the Voluntary Early Redevelopment Scheme (VERS) builds up, National Development Minister Lawrence Wong has urged patience about the details, noting that the more immediate policy to watch is an expanded upgrading programme.

As MPs sought more details about VERS, which lets owners of older HDB flats vote for the Government to buy back their units, Mr Wong said the road map for housing redevelopment includes more immediate initiatives such as an expanded upgrading programme.

While VERS was among the slew of new housing policies rolled out at last month's National Day Rally, "there are quite a number of major items that have to be put in place", with the more immediate one being the expanded Home Improvement Programme (HIP), he said in Parliament yesterday.

An ongoing programme, HIP I will be expanded to cover more HDB flats - those built between 1987 and 1997 - while a new HIP II scheme will see each flat upgraded a second time during its 99-year lease, when it is around 60 to 70 years old.

The earliest that flats can go through a second round of upgrading is in around 10 years.

HIP, which costs several billion dollars, will be a major HDB programme, "assuming we have the budget for it", said Mr Wong.

Meanwhile, VERS will kick in only in around two decades, when the first flats turn 70 years old or so.

"It is really quite a major series of initiatives and programmes that will have to be implemented, and we will do it step by step, systematically," he said.

Yesterday's Parliament sitting was the first time MPs had a chance to pose questions since the new programmes were announced by Prime Minister Lee Hsien Loong three weeks ago.

In total, five MPs sought details, including the extent of coverage of VERS and how compensation will be computed.

But Mr Wong said it is too early to say, as the ministry is still going through "a very thorough study" on how to implement the scheme.

Asked by Mr Alex Yam (Marsiling-Yew Tee GRC) when the results of the study would be shared, he said: "I wouldn't want to restrict or indicate now a specific deadline, but we have been looking at this issue for quite some time."

Mr Wong also assured the House that VERS would be rolled out "in a fiscally sustainable way, so that it does not become a burden for the next generation".

He added that while more flats would be eligible for VERS as compared with SERS, which is limited to precincts where there is high development value, not all would be chosen for VERS. SERS applies to about 5 per cent of HDB flats.

"For residents who do not get VERS for their flats, or who do not poll in favour of VERS, they will continue to live in their flats, which would have benefited from two rounds of upgrading," he said.

The Government would also help them get another flat to live in at the end of the 99-year lease.

This could be a new flat from HDB for those who are eligible, a resale flat with a shorter lease or a two-room flexi flat for retirement.

The Government is also looking at how to make the use of CPF funds more flexible so that buyers can purchase HDB flats with shorter leases while having enough to retire on, said Mr Wong.

"With CPF changes, it is not just about the policy, but updating the IT system," he said.

Of these plans that will span the next few decades, Mr Wong said: "Whether they come to pass depends on our external, economic and financial situation. But this Government has a track record of delivering on our commitments."

** Parliament: Private developers may have a role in redeveloping older flats for VERS, says Lawrence Wong
They may be involved in VERS as Govt works out best way to implement scheme, says minister
By Rachel Au-Yong, Housing Correspondent, The Straits Times, 11 Sep 2018

Private developers may have a role in redeveloping ageing Housing Board flats as the Government studies how best to implement a new scheme for such homes.

Yesterday, Minister for National Development Lawrence Wong said in Parliament that he "will not rule (private developers) out" for the Voluntary Early Redevelopment Scheme (VERS), which was introduced last month to pace out the redevelopment of old flats over 20 to 30 years.

But even if private developers are involved, "let's be very clear that our aim is to redevelop public housing estates, so we will ensure that any redevelopment is done in a way that preserves the character of our HDB towns and supports HDB's mission to provide affordable and quality homes for Singaporeans", he said.

Responding to Ms Cheryl Chan (Fengshan), Mr Wong said that private developers are already "from time to time" involved in some Selective En bloc Redevelopment Scheme (SERS) sites.

He did not name these sites, but an upcoming Holland Village extension with retail shops and homes, which was tendered out to private developers, will be built on land acquired earlier under SERS. Also, the site of five old HDB blocks in Zion Road has been earmarked for a future hotel, as well as new homes.

Mr Wong also assured Dr Lily Neo (Jalan Besar GRC) that flats picked for SERS-limited to HDB flats with high redevelopment potential - would not be held back or affected by VERS. That is because many of these sites have already been selected, he said. SERS affects about 5 per cent of all HDB flats.

Ms Denise Phua (Jalan Besar GRC) also asked how the Government would prevent any VERS exercise from turning acrimonious, as has been the case in some private sites that were sold en bloc.

Mr Wong replied that the HDB is mindful of the possibility, but added that the agency is not new to garnering votes for upgrading programmes, such as for lift upgrading or the Home Improvement Programme.

"We have some experience, we will build on that experience, we will see what has been done in the private sector, and we will work out what is the best possible arrangement for VERS in order to achieve the outcomes that we want, while minimising some of the downsides that the member has highlighted," he said.

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