Wednesday, March 2, 2011

To be demolished soon... ...for rent in the meantime

SOME old Housing Board blocks slated for demolition under a redevelopment scheme are getting an extended lease of life - as long as three years in some cases - as rental flats fetching market rates or as temporary housing for needy families.


Fresh figures released by the HDB to The Straits Times show that of the 35,000 flats in 25 blocks picked for the Selective En bloc Redevelopment Scheme (Sers), about 2,200, or 6 per cent, are still standing.


Under Sers, selected older blocks are redeveloped to optimise land use. A recent survey shows the scheme is popular with 95 per cent of residents polled. They get market-value compensation and have the first bite at buying new flats.


The HDB said some blocks, whose redevelopment plans have not been finalised, are 'leased out to meet short-term rental demand'. They are leased to private operators chosen via tender. They pay HDB $700 a month on average for each flat and can decide how much to charge tenants, who must be either Singaporeans, permanent residents, students or those with employment or S-Pass permits.


About 1,400 of the 2,200 Sers flats are offered at market rental rates while 800 are set aside for interim rental housing.


The latter scheme, introduced in 2009, assists needy families. They pay rents below market rates.


The HDB said EM Services, which manages the interim rental flats in Havelock Road, Taman Ho Swee, Toa Payoh Lorong 5 and 6 and Bedok South, charges about $300 per month for a room, against the market rent of $500 to $600.


Some other sites leased to operators for interim use are in Tiong Bahru, Commonwealth Drive and Boon Lay Avenue.


The operators, including LHN Group and Katong Hostel, foot the costs of refurbishing, maintaining and managing the flats.


The practice of leasing flats while awaiting redevelopment is not unlike that in the private sector, where developers often rent out units in vacated projects clinched in collective sales to maximise returns.


But some people feel vacated Sers flats - being public housing - should be used only to help those in financial difficulties.


Mr Leong Sze Hian, a past president of the Society of Financial Service Professionals who has written on online forums about this issue, said he felt public housing should be set aside for local families.


'Since we have a waiting list for those under the public rental scheme, why not offer these flats to such families who are in need first?' he added.


Tenants of public rental flats pay $26 to $275 a month, depending on flat type.


Housewife Yeong Mew Ching, 40, is among those who feel that the HDB could manage the Sers flats directly and rent them to those with financial woes.


Her family is not eligible for public rental flats or interim rental housing and is paying $1,500 a month to rent a three-room flat in Hougang from EM Services. The family has faced difficulties paying rent since her husband lost his office job recently.


EM Services general manager Andy Low said the firm is like any other landlord, adding: 'Our rents are not high, they are set at attractive market rates. We're not in a position to subsidise rental housing for families as that's not our mandate.'


The HDB said the Sers flats are not suitable for use as public rental flats because they are slated for demolition.


MP for West Coast GRC Cedric Foo, who chairs the Government Parliamentary Committee for National Development, has noted that this might not be a solution because families could become entrenched in the area or get used to living in these flats and HDB may have difficulties relocating them when the flats are finally redeveloped. 'A more effective solution is to look at the root of their financial difficulties and offer assistance to help the families find jobs, and give them subsidies and grants to help them with the costs of living,' he said.


MP for Aljunied GRC Cynthia Phua said the HDB could consider setting aside all vacated Sers flats for interim housing for families moving from one home to another. 'We could have means testing so that each family pays according to what it can afford,' she added.

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