Starting April next year, elderly flat owners keen to take up the Lease Buyback Scheme will have the flexibility to choose the length of lease they want to retain, depending on their age and preferences, instead of being limited to a standard 30-year lease currently.
Those aged 70 to 74 will have the option of a 25-year lease, while those aged 75 to 79 will have the option of a 20-year lease, and those aged 80 or older will have the option of a 15-year lease. Those who prefer longer leases can choose to retain more than the minimum required for their age in five-year increments, up to a maximum of 35 years.
This was one of several enhancements announced by the Housing and Development Board (HDB) and the Ministry of National Development on Wednesday (Sep 3) to help seniors monetise their flats.
Other enhancements include raising the household income ceiling for participating elderly households from the current S$3,000 per month to S$10,000 per month.
Households with two or more owners will also no longer be required to top up their CPF Retirement Accounts to their full age-adjusted prevailing Minimum Sum. Instead, they only need to top up to half of the Minimum Sum, and have the option to withdraw more cash upfront.
The S$100,000 cap on cash proceeds of the lease buyback, however, will be retained. Owners will have to top up the excess of S$100,000 into their respective CPF Retirement Accounts.
The changes follow Prime Minister Lee Hsien Loong’s National Day Rally speech last month, in which he announced that the scheme will be extended to four-room flats.
National Development Minister Khaw Boon Wan said earlier that his ministry was studying ways to increase the flexibility of the scheme. He said there are concerns about outliving the 30-year lease, while others feel the 30-year lease could be too long for those who are older.
Currently, elderly owners who qualify can sell part of their flat’s 99-year lease back to the Housing Board in return for monthly payouts, keeping only a 30-year lease.