Singapore Government Press Release

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HDB is launching a pilot project to build and sell studio apartments to our elderly Singaporeans. The target group is citizen lessees who are 55 years of age or older and have owned their current HDB flats for at least 10 years.

The objective of the project is to assist such elderly households to realise the appreciation in the value of their existing flats by enabling them to move from their bigger flats to these smaller apartments without having to lose the roofs over their heads. They can enjoy additional income and yet live near their children and with other elderly people in HDB estates where the public amenities are easily accessible.

Four sites have been identified for the pilot project. They are at Tampines, Bedok, Yishun and Jurong East (see maps in Annex A1 to A4). There is an existing framework of good social and commercial facilities and transportation systems in these estates. In addition, there is a concentration of elderly households around these four sites. A total of 580 studio apartments will be built for the pilot project.

The studio apartments will be built on its own without being combined with other flat types. This is to maximise the yield of the site and to ensure that the whole block is purpose-built to cater to the needs of the elderly with space provided for social and communal facilities to be operated by voluntary welfare organisations and commercial enterprises. Annex B1 shows the layout of a typical block.

The studio apartments come in two sizes: 35 sq m (Annex B2) and 45 sq m (Annex B3) with one bedroom, which would provide sufficient living space for a one or two person household. About 40% of the 580 studio apartments will be 35 sq m in size and the remaining 60% will be 45 sq m.

The studio apartments will be partially furnished with improvement items as listed in Annex C. To make studio apartments affordable, they will be sold on a 30-year lease with an option to extend it for another 10 years. The 35 sq m studio apartments will be sold at between $63,300 and $69,100 and the 45 sq m apartments will be sold at between $79,100 and $86,500.

Eligible elderly lessees who are interested to buy a studio apartment can submit their applications to HDB at the end of 1st Quarter 1998. HDB will allocate the apartments in order of queue numbers, with priority given to two groups of applicants. Those who will enjoy priority allocation are the elderly with children living in the same electoral division where the studio apartments are; and those parents who live in the same electoral division where the studio apartments are if their children take over the existing flat from the parents. The electoral divisions of the four sites in the pilot project are shown in Annexes A1 to A4. The remaining flats will be allocated to applicants living outside the electoral division.

Applicants who had bought one flat directly from HDB need not pay the resale levy, but those who had bought two flats directly from HDB will have to pay a 20% premium for the studio apartments. They will not be allowed to buy another flat from HDB again. They will have to sell their studio apartments to HDB if they no longer wish to stay there. HDB will pay for the flats at a pro-rated scale. They will also not be allowed to rent a flat from HDB.

The elderly lessees who sell their HDB flats in the open market are required to top up their Medisave Account to the prevailing amount to be set aside at age 55, which is currently $20,000. The net sale proceeds will be sufficient to purchase a studio apartment and the remainder can be used either to pay for an annuity plan or be withdrawn in one lump sum.

Annexes D1, D2 and D3 illustrate the monthly disposable income accrued to 3-room, 4-room and 5-room flat lessees after purchasing an annuity plan, while Annexes E1, E2, E3 illustrate the respective figures for those who have to pay a 20% premium for the studio apartments.

Studio apartments will provide our elderly Singaporeans not only an opportunity to enjoy additional income, but also to live near their children and with other elderly people in HDB estates where the public amenities are easily accessible.

MINISTRY OF NATIONAL DEVELOPMENT

5 NOVEMBER 1997

[Please note that the Annexes, only available in hard copy, may be obtained from the Ministry.]