Although the new Lease Buyback Scheme (LBS) provides more elderly Singaporeans with the option to monetise their HDB flats, National Development Minister Khaw Boon Wan said in a blog post that he is worried some seniors will spend the substantial cash proceeds unwisely and urged them to exercise prudence and caution.
Mr Khaw gave an example of the many overseas properties being marketed in the city-state and how there are bound to be disappointments and even losses.
“The best advice I can offer, is to use the substantial cash proceeds to voluntarily top-up you and your spouse’s Retirement Accounts. That will be a sure way to ensure that you can both enjoy a steady income each month in your golden years.
“Of course the best option is to live with your children to enjoy their company, and rent out your flat as your additional retirement income. Then there is no need for LBS,” noted Mr Khaw.
Among the enhancements to the scheme, which come into effect on 1 April 2015, LBS will be extended to 4-room flats with greater flexibility in lease options.
This was in response to feedback from Singaporeans who shared their views during the Our Singapore Conversation on Housing.
Romesh Navaratnarajah, Singapore Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email romesh@propertyguru.com.sg
