Value of HDB flats at end of 99-year lease

All HDB flats are sold to Singaporeans on a 99-year lease. We are technically not home owners, but lessees. I asked the Minister for National Development, during the 20 January 2014 Parliament sitting, what the value of HDB flats would be once their leases expire. I also asked whether the pace of SERS — the Selective En Bloc Redevelopment Scheme — will be fast enough to replace the flats reaching the end of their lease.

All HDB flats are sold to Singaporeans on a 99-year lease. We are technically not home owners, but lessees.

I asked the Minister for National Development, during the 20 January 2014 Parliament sitting, what the value of HDB flats would be once their leases expire. I also asked whether the pace of SERS — the Selective En Bloc Redevelopment Scheme — will be fast enough to replace the flats reaching the end of their lease.

The Minister confirmed that the value of the flats will be zero at the end of their 99-year lease. He also indicated that the selection of sites and pace of SERS depended on factors including the site’s redevelopment potential. Implicit in what he said was that SERS is not a scheme intended solely to replace old flats reaching the end of their lease.

He revealed that there are about 31,000 flats which are more than 40 years into their 99-year leases. This number will grow larger each year. It remains to be seen what the Government’s plans are for lessees whose flats approach the end of their lease.

The full transcript of the question and answer are below.


Mr Gerald Giam Yean Song asked the Minister for National Development (a) how many HDB blocks are more than 40 years into their 99-year lease; (b) what will be the value of an HDB flat once it reaches the end of its 99-year lease; (c) what is the average number of flats undergoing redevelopment under the Selective En Bloc Redevelopment Scheme (SERS) each year for the past 10 years; and (d) whether the pace of SERS is fast enough to redevelop all HDB blocks before they reach the end of their lease.

Mr Khaw Boon Wan (The Minister for National Development): The Selective En bloc Redevelopment Scheme (SERS) is part of the Government’s estate renewal strategy for older estates. It allows intensification of land use and revitalises such estates through new developments. At the same time, it offers an opportunity for flat owners to buy a new replacement flat with a fresh 99 year lease.

In the last 10 years, SERS has benefitted the owners of about 18,000 flats. As the name suggests, the identification of suitable precincts for SERS is selective. The selection of sites and pace of SERS will depend on factors such as their redevelopment potential, and the availability of replacement sites for rehousing and other resources.

Currently, there are about 300 HDB blocks with 31,000 flats which are more than 40 years into their 99-year flat leases.

Like all leasehold properties, HDB flats will revert to HDB, the landowner, upon expiry of their leases. HDB will in turn surrender the land to the State.

[Source: Singapore Parliament Reports]

Author: Gerald Giam

Gerald Giam is the Member of Parliament for Aljunied GRC. He is a member of the Workers' Party of Singapore. The opinions expressed on this page are his alone.

45 thoughts on “Value of HDB flats at end of 99-year lease”

  1. Is that a stupid question…everyone knows that..and yet you have to ask that stupid questions.

    Can you asked him what is the breakdown of the cost of the HDB flats..and how much reserve the government or individual ministry has…and what about Singaporeans…why must they served National Service..when PR do not need to..

    Asked the right questions lah..

  2. I am concerned with those flat owners who defaulted on their flat mortgage and eventually lead to HDB repossessing the flats.
    Without a flat to live in, those individuals would be homeless and may end up living at the beach or at the void decks.
    I would like to know from the Minister of National Development … about the numbers of flat acquired from such circumstances yearly and what sort of assistance being rendered to the said individuals.

  3. At the end of the 99 years lease…. the value of the flat would be zero so what would happen then to the occupiers of the said flats ???

  4. After 99 years, the owner will be happily lying in the grave, no need a roof over the body.

  5. How long do you expect to live…if you bought your flat at the age of 20 (assuming)…and 99 years will be 119 years old…Are you expected to live that long…Wake up …

    Asked the MND as to why PR are allowed to buy HDB flats…Asked this type of questions lah…or was it LTK asked you to ask..

  6. He’s playing on fears of HDB taking back at end of 99 years lease. Usual grand standing. Cheap shot. He’d be better off asking this question in Parliament of MDN and Min Khaw.

  7. HDB don’t even wait for the flat to reach 50 years old before doing en bloc and offering new flats to those affected.

    How come Gerald is not aware of this? Is he a Singaporean?

  8. Mr Giam,
    Suggest discussion around emotion-tagging issues like the 99-yr lease would probably be too complex for eloquent yet mentally bankrupt champions. Further suggest you improve
    your own knowledge-base on the real world dynamics. Try achieving something concrete in life, like in academia or in professional arena or in biz. Then come back and project your credentials into your statements.

  9. Hi Gerald. Could you also ask Khaw (in Parliament or on his Facebook [I’m not a member]) why Bukit Ho Swee Estate isn’t included in SERS? The estate is 51 years old and is older than Covent Gardens Estate, which came under SERS (land now earmarked for new hotel) and whose residents now reside in Ganges Avenue. FYI HDB has almost completed new blocks next to Tiong Bahru Plaza. Dunno if they are for those residents from other younger estates that came under SERS.

  10. Hi Gerald,

    Will 99 years leasehold will become Freehold if opposition takeover? If not, why are you asking silly questions in parliament?

  11. Hi Gerald,

    I give you 99 dollars.
    I take back 1 dollar every year.

    What is left after 99 years?

    Such childish question in Parliament is not accepted.

  12. This is very important question as most of the Singaporean assume their flat worth something at the end of lease .

    HDB flat aged 30 years and above shall see the property value drop annualy instead of rising … This is abnormal for any 99 years lease hold property . The reason of ppl still buying lease hold property > 30 due to the misunderstanding of SIRS scheme and thought government will do something about it at the end of lease .

    If you don’t believe , just look at those old landed property with remaining lease 10 years , and it only cost 10-20% market value of surrounding units .

    Wake up .. people ….

  13. Actually buying HDB in singapore just like buying car with COE .. At the end of the ‘entitlement’ , you only get back PARF value or ~10% worth of what you paid for .

    99 years private property are slightly different as the buyer have the option to renew the lease or selling it on bloc when it reach 30 years …..after 30 years … the property value will start depreciate cycle ( In a normal situation )

  14. Alvin god gracious are you a dumbf**k to not know any property with leases are 0 value after the years are up?

  15. The whole HDB lease system is f’d up to begin with. And it baffles me how everyone is okay with it.

    It is not about where you are going to live, as surely you will die before the lease is up. but you have to be less selfish than that to realize that you are essentially giving a lifetime of accrued wealth to the government.
    In most other countries you “OWN” property. it belongs to your family permanently, your children, and your childrens children and your childrens childrens children. and the property will be worth 100% of its value at any given time.

    The market can all keep up the masquerade pretending property retains is full value despite being partway through the lease. It has to get worse before it gets better.

  16. why do you guys think it is irrelevant… alvin had explained clearly the relevance and I believe gerald shares the same concerns.

    actually if you look at all the old hdbs, they’re not getting cheaper as they age (cos maybe other factors come into play) but unlike coe or whatever other assets, there’s no depreciation even if we merely look at standard hdb valuation (prices vary with economy than with age)…. hence what’s important is whether should we to expect old hdbs to have a price, a new lease of life via SERS… every hdb owner deserves to know how the game is to be played… unlike private properties, old projects can go enbloc to any private developer but for hdbs, it’s a monopoly (HDB) setup… nevertheless, for private projects eg like some under Far East, which are bought under freehold but sold as 99-102yr lease, owners of such properties have to be concerned too since private developers become de facto SLA2 and skewing the balance of powers in negotiation in the event that the projects age..

  17. hi Gerald, can you fish out info from mnd/mom/mot/mof the breakdown of these 3 industries ..

    insurance agents
    property agents (30-35k)
    taxi drivers

    by age, gender, nationality (local, pr, foreigner, educational level)…. the government says the labour market is very tight, hence the need to import foreign labour… very curious to see what’s the breakdown … will give great insight to our labour distribution as these 3 have been the absorption sponges for any displaced/unemployed/underemployed … thanks!

    another would be why foreginers are allowed to work locally or come job hunting on tourist passes when we aren’t allowed to do the same in their countries or work in spore without a corporate sponsor (paid salary instead of strictly commission)… in other countries, foreigners aren’t allowed to do this at all …

  18. Dear Gerald,

    A lot of questions being posed to you here, but nary a response?

    I recommend that you should qualify your queries with solutions:

    1) What are your proposed solutions to convert lessees to “technically home owners” in land-scarce Singapore without negative socio-economic ramifications? I would assume if all properties are freehold, then we would face the problem of low land optimization with most people seeking low-rise developments and eventually zero lands available for development and ownership? How about old blocks that the owners do not have the finances to rebuild and become unsafe like the pre-war blocks often found in Bronx, New York.
    2) Why is the question posed only towards HDB and not generally since private leasehold have the same challenges?
    3) Are you against the Land Acquisition Act?

    – Roy

  19. Haji Adam,

    I didn’t receive by 99 dollars lei? But I remember paying the 99 dollars. At the end of the 99 years, I still land up with nothing.

    Such childish mathematics is not allowed in life.

  20. 99 year leasehold properties is not peculiar to our country, and certainly there are many 99 yr landed houses and 99 yr condominiums. Wonder why Gerald only bring up 99 yr HDB? Perhaps to whip up ground unhappiness?

  21. the reason is very simple… cos HDB is public housing, under government’s care… when you’re into private residences, the government sees you as having graduated and on your own…

    but in this case of public housing, cos government has the complete monopoly of HDBs, all HDB owners have no other alternatives to go to (unlike private residences where they can vote to go enbloc and sell to next developer with the highest bid price)…. hence the need for the monopolist to speak publicly of its intention and make the game rules known to its players (HDB owners)…

    it has nothing to do with whipping up ground unhappiness… it’s a reality that 80pc of the population who are HDB owners to know and contend with then decide how they wanna influence how the government treat them… to go on a random good luck basis or queue basis for the SERS… set both parties’ expectations right…

  22. Gerald did nothing wrong in getting the official confirmation from a PAP Government. Many still thinks your flats are your assets. Assets do not become zero after 2-3 generations.

    PAP also officially clarify not all flats will get SERS. This is expected as Government does not have enough money to SERS entire Singapore. So if your flat do not get SERS, what will you do? Sell? Who will buy if the leasehold is ending? What about the land that comes with the flat which you paid for ?

    Mah Bow Tan says flats are more expensive because need to factor land cost. So if the flats value becomes ZERO because of leasehold then what about the land you paid for? Land value cannot possibly be zero right? If leasehold value does not include the land then why Mah Bow Tan and HDB always say need to factor in land cost?

  23. Isn’t this what the opposition wants? during election, opposition parties only know how to complain about rising housing prices, car prices without providing any solutions. So ain’t the government is trying go along with your complains, coming out with cooling measures ? do you know how this affected many people directly or indirectly involved in these industries?

  24. “All HDB flats are sold to Singaporeans on a 99-year lease. We are technically not home owners, but lessees.”

    Well done, Gerald Giam. It took you 37 years to understand that clause in the HDB contract? And since where was it specified in the HDB contract that they were “home owners” intstead of “lesses”? Read carefully again.

    “I also asked whether the pace of SERS — the Selective En Bloc Redevelopment Scheme — will be fast enough to replace the flats reaching the end of their lease.”

    Did you not get the keyword “selective” instead of “comprehensive”? You implied that SERS was meant to replace the flats, but since when this stated to be so?

    “The Minister confirmed that the value of the flats will be zero at the end of their 99-year lease.”

    I’m surprised he was even willing to answer such a silly question. I’d have probably just rolled my eyes and ignored you.

    TLDR: HDB lease is 99 years. People made the knowing choice when they signed the contract to purchase it. Now, stop playing on feelings and emotions. You think people will support you if you do this? Look at the comment thread and think again.

  25. In short, your entire article shows a lack of comprehension with regards to contracts, policies and the law. It aims to whip up dissatisfaction among the HDB populace, perhaps for your own insidious intents.

    You are building up a strawman case by assuming your own version of the HDB contract and policies and then hinting that this is not fair by posting this article.

    And as others above have said, a 99-year contract is not exclusive to the HDB, but also the same case with private housing.

    Needless to say, how do you expect me to vote for you in the upcoming elections?

  26. Hi Gerald, I think your question on the 99 lease is very amateurish. It is only common sense that it will be worth nothing or little value (scrap value) at the end of the lease. Property rules on this is pretty well defined globally.

    The issue is also not about SERs as not all residents want SERs as they have to cough out money for a new place with a new 99 year lease + the trouble of moving house.

    The main issue you should be bringing out is the affordability of HBD flats for all Singaporeans (whether old or new) and ensure that all Singaporeans have a place to stay and call home. Techically whether it is a lease or you have ownership is not important as HDB will not “terminate” the lease unless there is a serious breach of rules such as illegal renting etc.

    I think we should focus on the key issues and not get distracted on the inconsequential ones.

  27. Why 99 yr lease is important….. because there is a lease buyback scheme

    A single flat buyer born in the 1970s buys a hdb flat also built in the 1970s. If the flat is not selected for SERS, will the owner be able to abstract money out of his flat other than renting out a spare room? It is also important to consider that his cpf might have been wiped out or left very little for retirement by the time he finishes paying his housing loan. The flat might not even be eligible for the goverment lease buyback scheme as there is not much excess lease left to sell back to the goverment since we need to keep 30 years lease of the flat at age 60 or 65 and sell it back to the goverment the remainder as the flat owner has a similar age as the flat. The goverment should speak up openly about this as the prices of aging flats are too pricey.

  28. dude just a suggestion, you should either put a nicer photo or not put a photo at all. It’s quite a turn off

  29. There is a huge issue of constitution of a nation in this question.
    Are our citizens allowed only to slog our lives and keep a property of his own for a slightly longer period of his lifetime, unable to pass down this savings of hard work to their future generations?
    Or is this small but expensive apartment, a true property of our citizen, a small but true belonging that we can have and achieve in our own land, Singapore?
    Or has the world world became so inequitable that only those rich enough to purchase freehold land can call it their own property?
    Hence, it is only right that we know, not just in the logic of the numbers of years of lease we have left, but more important, the true spirit of providing these public housings to our citizens.

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