‘Generosity’ of VERS scheme will give flat owners remaining value of lease: Sim Ann

'Generosity' of VERS scheme will give flat owners remaining value of lease: Sim Ann

SINGAPORE: Members of Parliament debated how expiring leases on Housing Board (HDB) flats will be dealt with on Tuesday (Feb 7), with Senior Minister of State for National Development Sim Ann rebutting the proposals and concerns raised by opposition members in the House.

During the debate on public housing policies, Assoc Prof Jamus Lim (WP – Sengkang) asked: “But notice that once we actually reach the 60 years or so, the only way to end up extracting the value is to sell (the flat) on to someone else so that we can actually retire comfortably by extracting that value.

“Now the question is: We are selling on a rapidly depreciating asset … What is the Government’s plan, at least at the macro level, to prevent creating a generation of home purchasers who have bought at the tail end just before the music stops?”

Ms Sim thanked Assoc Prof Lim, saying that he’s made the point for her that when flats reach the tail end of their leases, at about 20 years or 30 years left, the units would be very difficult to sell.

“That is the generosity of the VERS scheme – that the Government comes in as the purchaser of last resort when no one else would actually purchase and give the flat owner the remaining value of the lease,” she said. 

“At that point in time, even if you had value, would the private market realise it for you?”

She was referring to the Voluntary Early Redevelopment Scheme, which Prime Minister Lee Hsien Loong previously mentioned during the 2018 National Day Rally.