KHAW CONFIRMS VALUE OF HDB FLATS WILL BE ZERO AT END OF 99-YEAR LEASE

(12-02-2014, 05:46 PM)felixleong Wrote: well that's about 1% depreciation per year, if the HDB is worth 400k that's about 4k gone a year in value?

If you are referring to BTO, the $$$ goes into the reserves. Locked up for a 'rainy day'

HDB would give 1-for-1 replacement before they demolish the old HDB. But either you have to top up to get the same sqft or don't need to top up to get a smaller unit. I knew someone who were forced to move to Pioneer after the old blocks in Boon Lay kena demolished. So never ever buy a too-old flat because you don't know when you will be chased out.

(12-02-2014, 05:46 PM)opmi Wrote: Flats built in the 80s has GPR 1+. Now flats have 2.8 to 3.5 (if near to MRT).
Take back 1, then built 3 more. Likely to SERS.

Punggol/Sengkang flats less chance for SERS when they already GPR 2 to 2.8x. Unless HDB follow HK, GPR 6-8x. Then those mature estates lagi SERS-able.

Quote:I rather stay in old, big resale flat than Punggol/Sengkang new flats.

Definitely.
Mine is also 4A resale which i downgraded from a maisonette.
My 4A flat was always mistaken as a 5RM flat compared to Punggol/Sengkang new flats. And this happened about 15 years ago when my renovation contractors always asked whether mine is a 5 room flat or 4 room flat. Imagine "professionals" like contractors could mistaken a 4A as a 5 room flat 15 years ago. And you guess it right, they were comparing Punggol/Sengkang new flats, even then at that time. i suppose now BTO flats are even smaller but so much more expensive.
Very, very sad.

This should be a warning to the PRs who are "investing" in HDB for rental/capital appreciation. Many bought with the idea that the HDB prices will never fall.

(12-02-2014, 06:06 PM)Freenasi Wrote: This should be a warning to the PRs who are "investing" in HDB for rental/capital appreciation. Many bought with the idea that the HDB prices will never fall.

Man on the street thinks long term HDB prices will never fall.

I've posted this before: if u assume some 4% nominal appreciation annual, you will see prices start to stagnate around 60-70 years old and decline thereafter. We don't have flats that old YET.

So the key is whether govt will allow HDB flats to enter a structural declining phase. This will have huge impact on the population psyche and perception. Serious implications for the property market and political environment. A way to avoid the paradigmn shock is of course HDB to recover flats that are more than 60 years ago via SERS or otherwise.

But on a policy point of view, 99 years make a lot of sense. It provides for renewal of landscape.

(12-02-2014, 06:06 PM)Freenasi Wrote: This should be a warning to the PRs who are "investing" in HDB for rental/capital appreciation. Many bought with the idea that the HDB prices will never fall.

I thot PRs must sell flats/landed prop if they dont convert to citizens by the 10th year.

(12-02-2014, 06:22 PM)specuvestor Wrote:

(12-02-2014, 06:06 PM)Freenasi Wrote: This should be a warning to the PRs who are "investing" in HDB for rental/capital appreciation. Many bought with the idea that the HDB prices will never fall.

Man on the street thinks long term HDB prices will never fall.

I've posted this before: if u assume some 4% nominal appreciation annual, you will see prices start to stagnate around 60-70 years old and decline thereafter. We don't have flats that old YET.

So the key is whether govt will allow HDB flats to enter a structural declining phase. This will have huge impact on the population psyche and perception. Serious implications for the property market and political environment. A way to avoid the paradigmn shock is of course HDB to recover flats that are more than 60 years ago via SERS or otherwise.

But on a policy point of view, 99 years make a lot of sense. It provides for renewal of landscape.

You mean 60-70 years lease remaining??

We have those, former HUDC flats and Tiong Bahru SIT flats.

30 or so years lease remaining... which we haven't reach YET. By then my guess is that the valuation is more like commerical properties 30 years IRR kind of calculation via assumed rent.

(12-02-2014, 06:23 PM)opmi Wrote:

(12-02-2014, 06:06 PM)Freenasi Wrote: This should be a warning to the PRs who are "investing" in HDB for rental/capital appreciation. Many bought with the idea that the HDB prices will never fall.

I thot PRs must sell flats/landed prop if they dont convert to citizens by the 10th year.

Not that I know of. The rules are generally quite indistinguishable betw PRs and citizens until lately we see small change. All I know is many PRs want to buy HDB so that they can rent few rooms out to cover the instalment and at the same time wait for capital appreciation.

Wonder is re-sale worth so high price now. People paying more than 1M for Bishan Resale ....
A case of mass market ignorant ?