Cut land lease under GLS programme to 60 years

[reporter2]

Cut land lease under GLS programme to 60 years

JUL 28, 2017

The current en-bloc sale frenzy is a sign of pent-up demand for private housing, especially for 99-year leasehold properties.

The Government should consider reducing the lease of some selected Government Land Sales (GLS) plots to 60 years and release more land for sale for private housing projects.

This way, it will offer Singaporeans, especially young families and middle-aged couples with children, cheaper private housing without heavy mortgage payments.

The shorter lease will help reduce the cost of living which may translate into better quality of life .

Some retirees may also be keen to downgrade to 60-year leasehold private properties.

The release of more land with a 60-year lease will help meet the challenge of housing an ageing population looking for cheaper homes.

The 60-year lease private developments can be integrated with public and private housing estates which have 60 years left to their lease.

The Government can redevelop these estates when the homes reach the end of their lease.

This will create substantial economic activity and rejuvenate the estates.

Sum Kam Weng

[indomie]

99 leasehold soon become rarity. Maybe developers knew it's coming. That's why they are hoarding land now.

[Hakuho]

99 leasehold soon become rarity. Maybe developers knew it's coming. That's why they are hoarding land now.

A rarity soon ?

How many 60LH units out of a housing stock of 1.32 mil units today ? 60LH, the bank will also not finance the last 30-years lease, when its price will surely decline to zero.

[Kelonguni]

Correction. Not zero value but needs full cash and CPF to settle.

If close to zero value let me know where to buy.

Anyway, there is the possibility of tweaking the minimum 30 years for loan guideline although I won't count on it. Just don't cry foul if it happens.

Sum Kum Weng seems to like to stir.

A rarity soon ?

How many 60LH units out of a housing stock of 1.32 mil units today ? 60LH, the bank will also not finance the last 30-years lease, when its price will surely decline to zero.

[Hakuho]

Correction. Not zero value but needs full cash and CPF to settle.

If close to zero value let me know where to buy.

Anyway, there is the possibility of tweaking the minimum 30 years for loan guideline although I won't count on it. Just don't cry foul if it happens.

Sum Kum Weng seems to like to stir.

The first sentence, please illustrate what do you mean ?

[Kelonguni]

The first sentence, please illustrate what do you mean ?

Search any property portal for any property with any number of years left, you will find the prices are far from zero. Zero loan doesn't equate zero value.

[indomie]

Search any property portal for any property with any number of years left, you will find the prices are far from zero. Zero loan doesn't equate zero value.

It's possible that somewhere in the future that the gov allow old condo to "self en block". Top up the years, torn down and rebuild based on residents own initiative and capital. So, there is always value left.

[chestnut]

Hong Kong's lease is 50 years. Reference point

http://www.landsd.gov.hk/en/service/landpolicy.htm

[Hakuho]

Search any property portal for any property with any number of years left, you will find the prices are far from zero. Zero loan doesn't equate zero value.

I see. But any of them condo, HDB has reached the end 99-years. Plenty of cases in Landed though.

Anyway, Lawrence Wong must be lying.

[Hakuho]

It's possible that somewhere in the future that the gov allow old condo to "self en block". Top up the years, torn down and rebuild based on residents own initiative and capital. So, there is always value left.

Which law is forbidding self enbloc ?

[Laguna]

It's possible that somewhere in the future that the gov allow old condo to "self en block". Top up the years, torn down and rebuild based on residents own initiative and capital. So, there is always value left.

This case has been ruled out by SLA already.
See The Arcadia case

https://www.iproperty.com.sg/news/34...ng-for-Arcadia

[teddybear]

As usual, there will always be people trying to spread half-truth and fake news to convince others here to believe that there is "life" and continual value and capital appreciation after 99 years for "99-years leasehold" properties..........
Think they need to convince people to buy over their "babies" that they intend to flip at good price after staying for 10-20 years?

This case has been ruled out by SLA already.
See The Arcadia case

https://www.iproperty.com.sg/news/34...ng-for-Arcadia

It's possible that somewhere in the future that the gov allow old condo to "self en block". Top up the years, torn down and rebuild based on residents own initiative and capital. So, there is always value left.

[indomie]

This case has been ruled out by SLA already.
See The Arcadia case

https://www.iproperty.com.sg/news/34...ng-for-Arcadia

I know to extend the life of a condo in itself is not possible. But to act as own developer is possible. Lets say u have a 60 years condo. The residents can decide to pool money every month for the next 30 years to torn down and rebuilt a new condo that intensify the use of land. maybe in the end one condo can yield 2 condo.

[Kelonguni]

I see. But any of them condo, HDB has reached the end 99-years. Plenty of cases in Landed though.

Anyway, Lawrence Wong must be lying.

Even a landed with 30 years left is selling for a few hundred thousand minimum. How can be zero?

HDB rarely encounter over 50-60 years old, but still it's not going to be zero, especially if the location is good.

Lawrence is not kidding - the buyers or owners of very old properties are dealing with steep depreciation and / or huge maintenance fees.

They save on interest, but pay direct rent till the lease runs out.

[Hakuho]

Even a landed with 30 years left is selling for a few hundred thousand minimum. How can be zero?

HDB rarely encounter over 50-60 years old, but still it's not going to be zero, especially if the location is good.

Lawrence is not kidding - the buyers or owners of very old properties are dealing with steep depreciation and / or huge maintenance fees.

They save on interest, but pay direct rent till the lease runs out.

Did I say what you wrote?

I said "price declining to zero".

[Hakuho]

A rarity soon ?

How many 60LH units out of a housing stock of 1.32 mil units today ? 60LH, the bank will also not finance the last 30-years lease, when its price will surely decline to zero.

Anybody else misunderstood the last sentence written above ?

[Kelonguni]

Did I say what you wrote?

I said "price declining to zero".

Ok my bad. I read it as price declining to zero at the beginning of the 30 years lease left. Seems that you meant at the tail end of the lease.

Looking at the Geylang houses and Hillford, it does seem likely that 60 LH may be on the cards to cope with the Ageing population. Hillford is the experimental prototype to measure outcomes. Very unlikely to be once off.

May coincide with the allowance for short term rental?

[Arcachon]

So sad got a 99 years leasehold property.

Rental per month S$2,800 / S$ 33,600 per years / S$ 336,000 per 10 years / S$ 2,352,000 for 70 years.

Blk 27 Balam Rd S(370027)

Lease Start Date : 01 Jul 1997
Lease Duration : 99 years
Remaining Lease : 78 years (as at date of enquiry)

https://services2.hdb.gov.sg/web/fi10/emap.html

Will you pay S$700,000 to get S$2,352,000 for 70 years of rental income not adjusted for inflation.

Don't know is it good to kill the golden goose to get the eggs.

Please do not confuse yourself between self-stay and investment.

[Khng8]

Is there any theory behind the assumption that there will always be rental income in a perpetual, uninterrupted manner till end of lease?

[indomie]

Is there any theory behind the assumption that there will always be rental income in a perpetual, uninterrupted manner till end of lease?

Yes...and he forgot rent increase too

[Arcachon]

Is there any theory behind the assumption that there will always be rental income in a perpetual, uninterrupted manner till end of lease?

If you are House proud, renovate your House more than 30K most likely you will not always have rental income in a perpetual.

But if you bought your HDB for investment than you have a different story to tell.

Start renting my HDB since I get post oversea from 2001 from S$ 1200 a month to present S$ 2800 a month always the same story are you house proud or did you buy it for rental income.

Everytime I need to remind myself which is more important, House proud or rental income.

[Arcachon]

Yes...and he forgot rent increase too

Only investor can see the value, House owner need to think out of the Box.

Have been trying to reprogram myself after my Southbank appreciate a Million dollar in 4 years.

[Sandiwara]

So sad got a 99 years leasehold property.

Rental per month S$2,800 / S$ 33,600 per years / S$ 336,000 per 10 years / S$ 2,352,000 for 70 years.

Blk 27 Balam Rd S(370027)

Lease Start Date : 01 Jul 1997
Lease Duration : 99 years
Remaining Lease : 78 years (as at date of enquiry)

https://services2.hdb.gov.sg/web/fi10/emap.html

Will you pay S$700,000 to get S$2,352,000 for 70 years of rental income not adjusted for inflation.

Don't know is it good to kill the golden goose to get the eggs.

Please do not confuse yourself between self-stay and investment.

By using simplified calculation and 80/20 Theory:
Price 700k
Down Payment: 140k
80% renting income (20% vacant) = 0.80*2,352,000 = 1,881,600
Profit $ = 1,881,600 - 700,000 = 1,181,600
Profit % = 1,181,600/140,000 = 844%
Assuming inflation is 0%

Not many people understand the meaning of Mortgage is good loan. People only see the interest rate they do not calculate the inflation rate.

[Arcachon]

By using simplified calculation and 80/20 Theory:
Price 700k
Down Payment: 140k
80% renting income (20% vacant) = 0.80*2,352,000 = 1,881,600
Profit $ = 1,881,600 - 700,000 = 1,181,600
Profit % = 1,181,600/140,000 = 844%
Assuming inflation is 0%

Not many people understand the meaning of Mortgage is good loan. People only see the interest rate they do not calculate the inflation rate.

Wow, another investor level owner. Learn something new today.

[Arcachon]

If one will calculate 700k for 78 years.

You will be consuming (700,000/78)/12=747.86 a month with zero inflation rental so cheap where to find.

Every month save S$ 2000.

You save S$ 2000x12x78 = S$ 1,872,000.

This is what you call 99 leasehold HDB value will be zero when it reaches 99 years.

MND is doing a great job programming most of the people.

Facts and Figures don't lie, only flowery word do lie.

My first lesson in Statistic, my lecturer tell us this word. The statistic doesn't lie, the one who present the statistic does.

[Hakuho]

By using simplified calculation and 80/20 Theory:
Price 700k
Down Payment: 140k
80% renting income (20% vacant) = 0.80*2,352,000 = 1,881,600
Profit $ = 1,881,600 - 700,000 = 1,181,600
Profit % = 1,181,600/140,000 = 844%
Assuming inflation is 0%

Not many people understand the meaning of Mortgage is good loan. People only see the interest rate they do not calculate the inflation rate.

These calculations are flawed.

But never mind since you guys are so convinced, I will suggest that you should buy more LH and keep them forever.

[Arcachon]

These calculations are flawed.

But never mind since you guys are so convinced, I will suggest that you should buy more LH and keep them forever.

If only I can buy more, so sad.

[teddybear]

Yes, you can assume so if your property is in a prime good location, well-maintained, and have attractive attributes (like near MRT station and shopping malls, full and sufficient facilities for all residents to have quiet and enjoyable time to enjoy the facilities, decent residents, more than enough car parks for residents that want to park 2 cars or even 3 cars!) etc.
When crunch time comes and landlords need to fight for tenants, your unit will always get the tenant while others will have no choice but seeing their units vacant for extended periods with no tenants (e.g. during 1998 recession and 2009 recession).............
I have been through these period and I know this very well!
Obviously, some green birds and young horns will deny what I said, blah blah blah..........., but it is Ok. I let you all know first.

Is there any theory behind the assumption that there will always be rental income in a perpetual, uninterrupted manner till end of lease?

[teddybear]

really, that is small money..........

Only investor can see the value, House owner need to think out of the Box.

Have been trying to reprogram myself after my Southbank appreciate a Million dollar in 4 years.

[teddybear]

Why restrict to 78 years?
For freehold I can take 10,000 years!

If one will calculate 700k for 78 years.

You will be consuming (700,000/78)/12=747.86 a month with zero inflation rental so cheap where to find.

Every month save S$ 2000.

You save S$ 2000x12x78 = S$ 1,872,000.

This is what you call 99 leasehold HDB value will be zero when it reaches 99 years.

MND is doing a great job programming most of the people.

Facts and Figures don't lie, only flowery word do lie.

My first lesson in Statistic, my lecturer tell us this word. The statistic doesn't lie, the one who present the statistic does.