Saturday, April 20, 2013

The changing face of HDB

The Straits Times  |  April 13, 2013


An HDB studio apartment was exactly what Madam Anna Choong was looking for in which to spend her twilight years. The 63-year-old retiree had been living in a three-room Ang Mo Kio flat, but when her three sons flew the coop two years ago, she suddenly found it no longer suited her.

"It was getting lonely with all that space because they were either busy working or with their own families," says the sprightly grandmother of three in Mandarin. Her husband had died more than 10 years ago.

Now, she lives in an HDB studio apartment in Bishan tailored specifically to meet the needs of those above 55 like her.

These flats are smaller units sold on 30-year leases at a discounted price, specifically designed to meet the needs of the elderly. They range from 375 to 485 sq ft and come outfitted with elder-friendly features like non-slip tiles and pull-cords throughout, to enable help to be summoned in an emergency.

Madam Choong's sons helped her pay for her studio apartment, which cost about $80,000. "I've made many new friends. There's a smaller area to clean, and there are many things to do. What's not to like?" she laughs.

Typically, such flats are in estates with well-established transportation networks.

Her sons, who give her $700 monthly in total, also phone her every night to check in, and try to meet her at least once a week for a meal. "I may not have many things, but I've got good friends and good sons. For that I'm happy," she says.



For Mr Ryan Sim, a Housing Board flat is the best kind of investment.

Not only is it a safe one compared to the volatile private housing market, his Simei five-room flat also has a higher rental yield than a condo.

Its $2,900 monthly rent represents a 4 per cent to 5 per cent rental yield, compared to about 3 per cent for a private property, he says.

"The return is better than the dividends on stocks, and you have capital appreciation as well," says Mr Sim, 38, the general manager of a microprocessing company.

He moved his family of four into an East Coast condo in 2010, thus becoming one of 34,000 "HDB landlords" here.

This class of flatowners - private property upgraders who keep and rent out their flats - was created by a liberalisation of HDB sub-letting rules in 2002. Previously, only certain groups such as those working overseas were allowed to rent their whole flats out. As at the end of last year, over 43,000 flats were being sub-let.

HDB landlords are the target of ire from those who charge that those rich enough to own two properties should not be profiting from public housing.

While they can keep both properties and live in either, buyers who start out with a private property must sell their units if they buy an HDB flat.

Mr Sim said: "It would be unreasonable to penalise us by changing the rules now. When we and many others bought our flats, the ability to sub-let was factored into our long-term asset management plans."



Permanent residents Jim Wong, 38, and his wife, Jasmine Wu, 32, are proud home owners who feel their HDB flat has helped them put down roots here.

"Owning an HDB flat made us more sure that we wanted to stay in Singapore longer," says Mr Wong, a franchise and licensing manager. His wife is an accountant.

The couple, from Hong Kong and China, became PRs six months after moving here for work in 2004. Two years later, they bought a five-room resale flat in Sembawang for $321,000.

They have since had a son and daughter, aged six and three, who attend school nearby.

Mr Wong notes: "We also wanted to raise a family. If it was only two of us, there would have been no point in buying a flat, since we could have moved from rental to rental."

Their neighbours are friendly, and the Wongs have attended one's wedding and another's birthday party.

Mr Wong says that if they had not been allowed to buy a resale flat, their only other options would have been to keep renting or buy a condo unit, which would have stretched their finances.

"I'm glad that we could buy a flat. It's good for Singaporeans, who can sell their flats to us and upgrade using the profit.

"But I also know lower income people are not happy, because they find it harder to buy resale flats and may have to queue longer for a new one."



Handbag franchisee Sahara Sadik was excited last month when she heard the news that singles will be able to buy new two-room flats directly from the Housing Board come July.

As a bachelorette who turns 35 in June, and whose online home business has not yet broken even, she falls into the category of newly eligible buyers who cannot earn over $5,000 a month.

"I'm so excited. It's something we've been waiting for for a long time. It really doesn't make sense to buy on the resale market, which is really expensive now," she says. She lives in a four-room Pandan Gardens flat with her mother and two brothers, with her bedroom doubling as her office.

Ms Sahara started looking for a place two years ago, but says renting is too expensive: "It just doesn't make sense to put that kind of money into rent when you know it can go into housing you own. That's an asset."

But she will take care to make the right choice.

The new flats for singles will be in non-mature estates - and Ms Sahara wants to live near her mother to look after her.



When freelance actress Sheena Chan, 29, was looking for a flat three years ago, she and her then-fiance, 34, did not have the money for a private condominium or the cash for an HDB resale flat.

They ended up getting an affordable "best of both worlds" by buying a $580,000 five-room flat in Toa Payoh under the Design, Build and Sell Scheme (DBSS). Such flats are pricier than standard new flats, being part of what the HDB has called a "bold experiment" to let private developers market and build premium flats with higher-end finishings.

Now, the scheme has been suspended for a review after an outcry over DBSS flats in Tampines being marketed at close to $800,000.

In another twist, in January this year, Ms Chan's neighbours complained to their MP that poor workmanship and defects marred the luxury finishings they were promised. Wooden flooring, for example, had turned black in some cases.

"The idea to have a premium class of flats for sandwiched buyers like us was a good one," says the star of local horror flick Haunted Changi. "But the execution was bad."

But she still believes the HDB should still market higher-end flats to meet the aspirations of younger folk like her and her husband - who does not wish to be named, rather than "go back to basics". She says: "We couldn't afford a condo, we couldn't afford high cash over valuations and we did not want to wait for Build-to-Order flats. This was what worked for us."

Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C

Senior Sales Director
DTZ Property Network Pte Ltd (L3007960A)

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