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|September 27,2024RehouSERS: The HDB En Bloc Initiative
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Ever wonder what happens to older HDB estates? You know the ones, with the familiar corridors and the friendly auntie at the shop downstairs. Well, sometimes they get a chance for a fresh start through SERS - the Selective En Bloc Redevelopment Scheme. In this article, we'll delve into this government initiative and its implications. So if you're an HDB owner or considering becoming one, keep reading! However, if you're more interested in private properties, you might want to click here.
The Selective En Bloc Redevelopment Scheme (SERS) is a programme that serves to renew older HDB housing estates. This is not to be confused with regular en bloc, which can affect any property. SERS are typically directed towards HDB estates that are decades old that might require significant upgrading or even complete reconstruction to meet modern living standards and accommodate Singapore's growing population. Under this scheme, HDB acquires the affected properties and offers fair compensation, relocation options and rehousing benefits to residents.
- Site Selection
HDB will select sites for SERS based on the age of the estate, location, potential for redevelopment and overall urban planning needs.
- Announcement
Once an estate is chosen, HDB will announce the SERS to residents.
- Exhibition
HDB will then hold an exhibition on SERS near the affected estate so residents can visit and learn more about the process.
- Flat Valuation
Professional valuers appointed by HDB will assess the market value of each flats.
- Collectors inquiry
HDB will arrange for individual meetings with residents to confirm who owns the flat and help them with financial planning for relocation. They will also conduct a survey on the resident's preferred type of flat to give HDB an idea of the flat mix they need to have in the replacement site.
- Precinct survey
HDB will ask residents about their preferred facilities. They will also get to name their new home.
- Compensation notice
HDB will inform residents of how much compensation they will receive. More on that below.
- Rehousing options
Residents will get to choose one of the rehousing options provided by HDB. More on that below.
- New flat registration
If you choose to move to the designated replacement site, you can submit an application to HDB to register yourself. You can also do this under the Joint Selection Scheme to continue living close to your current neighbours.
- Selecting a new flat
HDB will provide sales brochures and price lists as well as your balloted queue number. Then, you will need to come down to HDB Hubs to book your new home.
- Key collection
When your flat is ready, you can collect your keys at HDB Hub.
- Moving out
You have up to four months after the key collection to renovate and move into your new flat. At this point, you will return the SERS flat and receive your balance compensation (if any).
There are several rehousing options you should review before you make your decision. They are as follows:
Taking up a new flat at the designated replacement site
You can choose to purchase a new 99-year lease flat, or, a new 3-room or larger replacement flat on a 50-year lease at the designated replacement site. However, the latter is only available for those aged 45 and above.
Apply for an HDB flat elsewhere
You can choose to apply for a flat with SERS rehousing benefits under the Build-To-Order (BTO) exercise, Sale of Balance (SBF) exercise or open booking. Do note that under the Resettlement, Relocation, SERS, and Tenants' Priority Scheme, HDB sets aside up to 10% of BTO and SBF flats for residents affected by SERS. Read more about priority schemes here.
Sell or transfer your SERS flat
HDB wants you to take the time and learn about the rehousing benefits that they offer, so you won't be able to sell or transfer your flat for a month after the SERS announcement. You can still choose to sell your flat after this period, but you won't receive the SERS benefits. However, you are not allowed to sell your SERS flat if you have previously received SERS rehousing benefits.
Receive ex-gratia payment on top of compensation instead of SERS rehousing benefits
You can return the SERS flat and receive ex-gratia payment on top of compensation, but by doing so you will not receive HDB's rehousing benefits. The amount of ex-gratia offered by HDB is $30,000 plus SERS grant (if you are eligible), 50% of which will be paid to you in cash. The other 50% will be paid into your CPF OA.
The amount of compensation each resident receives will differ based on the market value of their flat at the point of the SERS announcement. Additionally, residents will receive reasonable expenses to accommodate the moving process. The total compensation will be used to pay off what you still owe to your SERS flat. This includes property tax, outstanding housing loan and amount to refund (with accrued interest) to your CPF ordinary account (OA).
The remaining amount (if any) is what's called a balance compensation. You can use this to help pay for your new home. If not, you can ask for up to $35,000 in advance to help renovate your new flat, but you need to set aside a $1,000 retention sum. Once you return your SERS flat, you will receive the retention sum and any remaining balance compensation in cash.
source: hdb.gov.sg
The SERS rehousing benefits are offered to all eligible flat owners. The grant amount is credited to your CPF OA and can only be used to pay for a replacement flat from HDB. This amount will be returned with interest to your CPF OA when you sell or transfer the replacement flat in the future. Should your application for a replacement flat be cancelled, HDB will recover the grant amount with interest.
However, the rehousing benefits and grant amount you can receive may vary depending on your household status - a factor which will determine whether you should cry or celebrate when you receive a SERS notice. Here is a detailed breakdown:
First- and second-timer
Below are the benefits for first- and second-timers
| Rehousing benefits | Details |
| SERS Grant | $30,000 grant to buy a new flat at a subsidised price |
| Type of flat | Up to a new 5-room, or a 3Gen flat as long as you meet the following requirements:
Note: 5-room and 3Gen flats are only available at selected SERS replacement precincts |
| Fee Waivers |
|
| Deferred payment to HDB | You don't have to pay for the new flat until you collect your keys |
| Resale levy or premium concessions | Capped at $30,000, which can be paid using SERS compensation You will pay a resale levy or premium if:
If you sold your first subsidised flat between July 1985 and May 1997 and chose to pay a premium instead of the levy, you can now switch to paying the levy (up to $30,000) if it works out better for you financially. |
| Housing loan eligibility for replacement flat | If your SERS flat is or was financed by an HDB concessionary loan, you are eligible for a loan from HDB. The maximum amount of loan granted will depend on your credit assessment. If your SERS flat is or was financed by an HDB market rate loan or bank loan, you are not eligible for a loan from HDB. However, you may get a bank loan. |
Non-citizen spouse household
Below are the benefits for a household with a Singapore Citizen (SC) and a spouse who is neither a SC nor a Singapore Permanent Resident (SPR)
| Rehousing benefits | Details |
| SERS Grant | $15,000 grant to buy a new flat at a subsidised price If the SC spouse is under 35 years old at the point of SERS announcement, the non-citizen spouse must hold a long term visit pass or work pass that is valid for at least six months to qualify for this grant. |
| Type of flat | Up to a new 5-room, or a 3Gen flat as long as you meet the following requirements:
Note: 5-room and 3Gen flats are only available at selected SERS replacement precincts |
| Fee Waivers |
|
| Deferred payment to HDB | You don't have to pay for the new flat until you collect your keys |
| Resale levy or premium concessions | Capped at $30,000, which can be paid using SERS compensation You will pay a resale levy or premium if:
If you sold your first subsidised flat between July 1985 and May 1997 and chose to pay a premium instead of the levy, you can now switch to paying the levy (up to $30,000) if it works out better for you financially. |
| Housing loan eligibility for replacement flat | If your SERS flat is or was financed by an HDB concessionary loan, you are eligible for a loan from HDB. The maximum amount of loan granted will depend on your credit assessment. If your SERS flat is or was financed by an HDB market rate loan or bank loan, you are not eligible for a loan from HDB. However, you may get a bank loan. |
Singapore Permanent Resident (SPR) household
Below are the benefits for a household with no Singapore citizen owner.
| Rehousing benefits | Details |
| SERS Grant | No grant, but you can still buy a new flat at a subsidised price |
| Type of flat | Up to a new 5-room, or a 3Gen flat as long as you meet the following requirements:
Note: 5-room and 3Gen flats are only available at selected SERS replacement precincts |
| Fee Waivers | Administrative and booking fees for the replacement flat |
| Deferred payment to HDB | You don't have to pay for the new flat until you collect your keys |
| Resale levy or premium concessions | Capped at $30,000, which can be paid using SERS compensation You will pay a resale levy or premium if:
If you sold your first subsidised flat between July 1985 and May 1997 and chose to pay a premium instead of the levy, you can now switch to paying the levy (up to $30,000) if it works out better for you financially. |
| Housing loan eligibility for replacement flat | You are not eligible for a loan from HDB. However, you may get a bank loan. |
| Important notes | To receive a SERS grant of $30,000 and be considered for a housing loan from HDB, you must meet these requirements before collecting keys to your replacement flat:
|
Remaining single and joint singles households
Below are the benefits for remaining singles (Singapore citizens who have become the sole owner because the family members they bought the SERS flat with have passed away) and joint singles household (two or more single Singapore citizens who co-own the SERS flat).
| Rehousing benefits | Details |
| SERS Grant | $30,000 grant to buy a new flat at a subsidised price |
| Type of flat | Up to a new 4-room or the same type of flat as the SERS flat, whichever is bigger |
| Fee Waivers |
|
| Deferred payment to HDB | You don't have to pay for the new flat until you collect your keys |
| Resale levy or premium concessions | Capped at $30,000, which can be paid using SERS compensation You will pay a resale levy or premium if:
If you sold your first subsidised flat between July 1985 and May 1997 and chose to pay a premium instead of the levy, you can now switch to paying the levy (up to $30,000) if it works out better for you financially. |
| Housing loan eligibility for replacement flat | If your SERS flat is or was financed by an HDB concessionary loan, you are eligible for a loan from HDB. The maximum amount of loan granted will depend on your credit assessment. If your SERS flat is or was financed by an HDB market rate loan or bank loan, you are not eligible for a loan from HDB. However, you may get a bank loan. |
Single Singapore citizen household
Below are the benefits for those who bought the SERS flat as a single.
| Rehousing benefits | Details |
| SERS Grant | $15,000 grant to buy a new flat at a subsidised price |
| Type of flat | Up to a new 3-room or the same type of flat as the SERS flat, whichever is bigger |
| Fee Waivers |
|
| Deferred payment to HDB | You don't have to pay for the new flat until you collect your keys |
| Resale levy or premium concessions | Capped at $30,000, which can be paid using SERS compensation You will pay a resale levy or premium if:
If you sold your first subsidised flat between July 1985 and May 1997 and chose to pay a premium instead of the levy, you can now switch to paying the levy (up to $30,000) if it works out better for you financially. |
| Housing loan eligibility for replacement flat | If your SERS flat is or was financed by an HDB concessionary loan, you are eligible for a loan from HDB. The maximum amount of loan granted will depend on your credit assessment. If your SERS flat is or was financed by an HDB market rate loan or bank loan, you are not eligible for a loan from HDB. However, you may get a bank loan. |
| Important notes | You can receive more benefits if you apply for the new flat with your parents/children or become legally married before you collect the keys to your new flat. When the newly formed household meets the requirements to buy a 99-year lease flat from HDB (except for non-citizen spouse families), you can receive a higher SERS grant of $30,000 and be eligible to buy up to a 5-room flat. |
Third-timer and household who has had SERS benefits before
Below are the benefits for third-timers and households who have enjoyed SERS benefits previously.
| Rehousing benefits | Details |
| SERS Grant | No grant, but you can still buy a new flat at a subsidised price |
| Type of flat | For singles: up to a new 3-room flat For remaining singles and joint singles: up to a 4-room flat For families: up to a new 5-room, or a 3Gen flat as long as you meet the following requirements:
Regardless of your household, you also have the choice to pick the same flat type as your SERS flat, even if it is bigger than what is specified above. Note: 5-room and 3Gen flats are only available at selected SERS replacement precincts |
| Fee Waivers | Administrative and booking fees for the replacement flat |
| Deferred payment to HDB | You don't have to pay for the new flat until you collect your keys |
| Resale levy or premium concessions | Capped at $30,000, which can be paid using SERS compensation You will pay a resale levy or premium if:
You do not have to pay a resale levy or premium if you are a third-timer who has paid them before. If you sold your first subsidised flat between July 1985 and May 1997 and chose to pay a premium instead of the levy, you can now switch to paying the levy (up to $30,000) if it works out better for you financially. |
| Housing loan eligibility for replacement flat | You are not eligible for a loan from HDB. However, you may get a bank loan. |
| Important note | If you have previously had SERS rehousing benefits, you are not allowed to sell your SERS flat on the open market |
Private property owner
Below are the benefits for those who own or have an interest in private property at the time of SERS announcement.
| Rehousing benefits | Details |
| SERS Grant | No grant, but you can still buy a new flat at a subsidised price |
| Type of flat | For singles: up to a new 3-room flat For remaining singles and joint singles: up to a 4-room flat For families: up to a new 5-room, or a 3Gen flat as long as you meet the following requirements:
Regardless of your household, you also have the choice to pick the same flat type as your SERS flat, even if it is bigger than what is specified above. Note: 5-room and 3Gen flats are only available at selected SERS replacement precincts |
| Fee Waivers |
|
| Deferred payment to HDB | You don't have to pay for the new flat until you collect your keys |
| Resale levy or premium concessions | Capped at $30,000, which can be paid using SERS compensation You will pay a resale levy or premium if:
If you sold your first subsidised flat between July 1985 and May 1997 and chose to pay a premium instead of the levy, you can now switch to paying the levy (up to $30,000) if it works out better for you financially. |
| Housing loan eligibility for replacement flat | You are not eligible for a loan from HDB. However, you may get a bank loan. |
| Important notes | When you buy a new flat, whether it is at the replacement site or under a BTO, SBF exercise or open booking, you'll need to live there once it's ready. Your private property must only be kept as an investment, not your home. |
First- and second-timers, non-citizen spouse households, remaining single and joint singles households and single singapore citizen households have two options:
- Keep your new flat application with SERS benefits
- Cancel your application and choose one of the SERS rehousing options
Bonus for first-timers that allows you to enjoy two housing subsidies:
- Keep your application (public applicant) and sell your SERS flat with SERS rehousing benefits
- Keep your application (public applicant) and return your SERS flat for ex-gratia payment on top of total compensation
It depends. SERS is a blessing for those who do not own private property and would get the chance to select a new unit in the relocated estate. However, private property owners who have been happily collecting rent from their old flats would consider SERS a curse, especially since they won't be eligible for a replacement flat.
Plus, even though replacement flats are comparable to the old ones, they might not feel the same to residents. For example, the former residents of Rochor Centre might miss the convenience of being able to walk up to Suntec City. They may also have emotional attachments to their old homes, which are now just cherished memories.
Overall, while being selected for SERS can be unexpected, for some, it presents an opportunity to upgrade your living situation. And although many homeowners of older estates are hoping to be selected for SERS, only about 4% of HDB flats have actually been selected since its inception in 1995, so you should manage your expectations.
By understanding the process, compensation and rehousing options, you can make informed decisions about your future. Remember that there are plenty of resources and support available to you to ensure a smooth transition. Plus, our agents are always ready to lend you a hand.
Views expressed in this article belong to the writer(s) and do not reflect PropNex's position.
