HDB flat as retirement nest egg is fast becoming a … rotten egg

After having been repeatedly assured by PAP that public housing prices could only increase, HDB lessees are now left in the lurch.

This is because PAP has reneged on its promise and the pigeon-hole-in-the-sky prices look set to fall, maybe even collapse if accompanied by another global crisis.

Instead of resolving a self-created issue, PAP-controlled CPF Board  has increased the number of restrictions on the use of CPF for property, eg “… a member is only eligible to use his CPF if his age plus the remaining lease is at least 80 years“.

Worse, CPF use is also limited for property with a lease of less than 60 years, resulting in demand reducing to a trickle.  For a $500,000 property with a remaining lease of 59 years, the maximum amount of CPF that can be used “is $290,000.00 and this is 58% of the lower of the purchase price or the value of the property at the time of purchase”.

Assuming a potential buyer of a $500,000 5-room HDB flat uses up 58% of all his CPF for downpayment, he would still have to fork out $942 in monthly installments for 25 years on the remaining $210,000. (Mortgage calculator)

Owners … I mean lessees of more expensive HDB flats will be hardest hit because most potential buyers do not have much disposable income due to the 37% CPF contribution. Or may be unwilling to use cash while leaving CPF to earn a miserable 2.5 return.

Of the close to 1 million HDB sold flats (excluding HDB rental units), at least 200,000 flats were constructed before 1978, ie older than 40 years.

In 7 years’ time, 264,000 flats, give or take, will be added to this pool of aged flats.

1hdbe** (1978 – 29742, 1979 – 26709, 1980 – 18421) + 189299 = 264000 flats. Source: data.gov.sg

With every passing year, the shrinking pool of buyers of older flats makes it increasingly difficult to monetize our HDB lease for retirement.

The PAP government which created this mess has no solution, besides happily tweaking legislations and hoping for a miracle.  PAP elites have underestimated the impact of falling property prices.

All the hogwash about asset enhancement was just a pack of PAP lies, now fully exposed.

Is HDB flat a retirement nest egg or rotten egg?

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5 Responses to HDB flat as retirement nest egg is fast becoming a … rotten egg

  1. Once again. Govts interfere with market forces at their peril. They really think they’re smarter than everyone who builds sells and buys houses.

  2. Confused says:

    Maybe, I say maybe.

    It was initially thought by LKY and Lau Goh that with SERS, HDB would appear to be an ASSET ENHANCEMENT.

    However, it could lately pointed by some moneyminded smartass that not all estates going for SERS benefit the Pigs.

    Only lower rise centrally located matured make sense for SERS as estate like Redhill 7 storeys was given SERS. The same plot of land of almost 20 blocks of 20×42 = 840unit would be able to redeveloped into say 15 blocks of 45storeyx8=360 units/block. 15 blocks 360=5400unit.

    By going SERS, the Pigs get to pocket profit from the sale for another 4 thousand over units.

    The less lucky and outskirt of course would not be chosen.

    But never say never, if they remain in force, with the 10m Mark, their days may come.

    Hahaha. Heaven can wait……

  3. Confused says:

    Assuming for additional 3000 units @average 400k for 3 & 4 room, it would be 900 million profit assuming cost at 300m.

  4. Sinkie says:

    Old Fart & Woody KNOW that they were talking BS to Sinkies … Old Fart & Woody not that dumb.

    It is the Sinkies who are stupid.

    However PAPies know that the time bomb will explode long after PAPies have run road. Look at all the PAPies MPs, ministers, perm secs, senior civil servants, CEOs / Chairmen / MDs of GLCs and TLCs and stat boards —- all of their family already have multi-millions to run road even today if required.

    With the stupidity of Sinkies, PAPies still have another 10-15 years to ass-fu*k Sinkies & squeeze a few more billions before they run road.

  5. DavidLKSee says:

    WHY PAP Million-dollar Govt is One Big Political Sick Joke:

    PAP = Political Arseholes Party
    SG = Screwed-up Gabra-men [not Singapore Government]

    TCM = Talk-Cock Ministers [not Traditional Chinese Medicine]
    MSG = Money-Sucking Govt [not Monosodium Glutamate]
    CPF = CON People Fund

    ERP = Everyday Rob People
    COE = “See Hor Yee” [Hokkien for Pay And Pay until DIE STANDING]
    GST = “Gasak Sampai Teruk” [Malay for Pay And Pay until DROP DEAD]

    PAP = PAY And PAY
    PUB = Pay Until Bankrupt
    HDB = High Debt Bankrupt ( BLOODY Hell, HDB new/resale flats so BLOODY costly — no thanks to the two BLOODY Multi-millionaire Ministers Mah Bow Tan & Khaw Boon Wan )

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