A Round of Old HDB Flat Upgrades to Begin in 2020

A Round of Old HDB Flat Upgrades to Begin in 2020

The Housing and Development Board (HDB) in Singapore announced its intention to make older public housing towns liveable through a second round of upgrades and renovations that will start in 2020.

The Home Improvement Programme

The Home Improvement Programme (HIP) helps for the resolution of some common maintenance problems occurring in older HDB flats. It was rolled out in 2007 to fix issues like spalling concrete and deteriorated waste pipes.

As per the programme’s conditions, HDB flats built until 1986 that haven’t undergone upgrades via the Main Upgrading Programme (MUP) are eligible for HIP enrolment. There are three main components the programme consists of – essential, optional and Enhancement for Active Seniors (EASE).

The government provides full funding for essential improvements under HIP. In addition, large subsidies are available for optional renovations.

In the case of EASE upgrades, the cost is estimated at approximately 2,500 dollars. The government subsidy covers up to 95 per cent of the cost. This means that depending on the subsidy amount, residents will only have to pay between 125 and 312 dollars for the entire project.

In March 2019, HDB announced an extension of the HIP programme to make more flats eligible for inclusion.

As per the new conditions, the programme subsidies and financial assistance will be extended to older flats constructed from 1987 to 1997. Minister of National Development Lawrence Wong said that town councils will be given the option to nominate their own flats later on in 2019.

Terms and Conditions of the Extension

Through the extension of the HIP programme, the government will provide funding for the upgrades in 230,000 additional old flats. In August 2018, HIP improvements were announced for 242,000 out of 320,000 eligible flats throughout Singapore. The upgrade and renovation works have already been finalised in the case of 122,000 apartments.

Once HIP and MUP upgrades are completed, 450,000 apartments would have gone through a home renovation process that is subsidised by the government.

According to the official announcement, it is difficult to determine when the upgrade and renovation works are going to end for the new flats added to the HIP programme under the extension. The availability of funds will be determining for the renovation speed, Minister Wong said.

The extension of the HIP programme will cost Singapore authorities more than four billion dollars. According to Minister Wong, however, the allocation of the sum to old property upgrades is entirely worthy.

Apart from extending the scope of HIP, the government has announced a few other legislative changes that favour the owners of older HDB apartments.

The authorities will provide additional updates about HIP II – a round of upgrades for flats ranging from 60 to 70 years in age. In addition, announcements will be made about the Voluntary Early Redevelopment Scheme (VERS) programme. VERS allows the owners of older HDB flats to sell their property back to the government.

Under VERS, owners can vote on selling the ageing flats back to the government for redevelopment purposes. Apartments eligible for inclusion in VERS need to have reached their 70-year age mark. The aim of the programme is to address the significant reduction in price that flats go through when they reach the final years of a 99-year leasehold.

Original HIP Timeframe Was Too Limiting

In an official statement, Minister Wong said that various flats in Singapore that were showing signs of ageing have not been included in the original renovation programme.

Some of these apartments are located in Tampines, Yishun and Jurong. They were built both before and after 1986 and even residents of some of the younger flats were hoping for upgrades. At the same time, they did not meet the original and quite restrictive HIP programme criteria.

According to Minster Wong, the completion of the renovations will increase the lifespan of the HDB flats by anywhere between 30 and 40 years. By that point in time, they will already be 60 to 70-year-old. Hence, additional work will be required to overcome typical structural and construction issues stemming from decades-long operations.

When this happens, the apartments will qualify for the HIP II programme, giving the owners a chance to qualify for governmental funding once again.

This means that every HDB flat will be upgraded twice during its lease.

The first renovation will be carried out under HIP or MUP. The second round of upgrades will occur at the time the property reaches an age of 60 to 70 years. This renovation will be carried out under HIP II. Both of the programmes aim to help HDB residential property retain its value through the years.

These announcements give HDB flat owners some certainty about their assets. In the past, ageing HDB apartments experienced massive depreciation. Through the introduction of HIP and VERS, the difference between an old HDB flat reaching the end of the lease period and a privately held apartment is becoming less distinctive.

Since the renovation schemes are anticipated to continue being operational in the long run, first-time HDB property buyers right now can have some clarity about long-term prospects in the future.

Do You Own an Older HDB Flat?

If you own an older HDB flat, you should definitely look into the chances for getting a government renovation subsidy.

The government covers a large amount of the sum required for essential and optional renovations. You may want to check the website of HDB out to get a better idea of the HIP terms and conditions.

Home Guide is an interior design company in Singapore that can also shed some light on what’s covered and what you’ll need to address on your own.

Home Guide is an HDB-licensed team of interior design professionals.

We understand the best residential practices and the HDB guidelines for home maintenance and renovation. Our projects cover the spectrum – from modern and minimalist to rustic and ornate. Don’t hesitate to contact us today and discover the possibilities for old HDB flat upgrades.

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