New Lease Buyback Scheme to benefit 75% of elderly households: MND

The income ceiling has also been raised.

The Ministry of National Development (MND) and the Housing & Development Board (HDB) yesterday revealed four enhancements to the Lease Buyback Scheme, aimed at bringing the LBS to more elderly households, and providing greater flexibility to suit different preferences and needs.

The LBS will now be extended to 4-room HDB flats, which will cover 75% of elderly HDB households compared to 35% currently.

Four-room households will receive a $10,000 cash bonus per household when they participate in the LBS, on top of the proceeds they receive from selling the tail-end lease of their flat to HDB.

The income ceiling for participating in the LBS will also be raised to $10,000, from $3,000 per month. The income ceiling for the Silver Housing Bonus (SHB) scheme will be raised from $3,000 to $10,000 correspondingly, which will allow elderly who are still working and/or living with their family members to qualify for these monetisation options.

The requirement for households with two or more owners to top up their CPF Retirement Accounts (RA) with the LBS proceeds will be relaxed.

These changes to the LBS and SHB will come into effect on 1 April 2015, after computer system changes, noted the MND.

Here’s more:

The enhancements to the LBS were made in response to feedback received during the Our Singapore Conversation on Housing, where MND engaged Singaporeans, including the elderly, their children and experts, on monetisation options for the elderly.

Together, CPF and home ownership form twin pillars of retirement adequacy for Singaporeans. Today, about 290,000 HDB flats are owned by Singaporeans aged 55 or older; 80% of these flats are fully paid up, with no outstanding mortgage loan.

They have various options to monetise their housing asset for additional retirement income should they need or choose to. These include a) renting out a room, b) renting out the whole flat and moving in with their children, c) selling their flat and moving to a smaller flat or Studio Apartment with the option of the SHB, and d) the LBS.

The LBS provides one option for the elderly to monetise their HDB flat to supplement their retirement income, while continuing to age in place in their own home.