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Author: Ravi Philemon
Silver Housing Bonus enhanced to help elderly households supplement their retirement income
At Ministry of National Development’s Committee of Supply debate on March 4, Minister for National Development Mr Lawrence Wong announced that the Silver Housing Bonus will be enhanced.
The Minister said that through engagements, his Ministry received feedback and ideas on how schemes like Silver Housing Bonus can be improved.
“One feedback is that the schemes are quite complex, and we can simplify them further. This is particularly the case for the Silver Housing Bonus, or SHB, which comes with several conditions. Having studied the matter, we have decided to simplify and enhance the SHB, in three ways.
First, we will remove the requirement that seniors must sell a larger flat and buy a smaller flat. Regardless of the type of flat they sell, seniors can apply for the SHB as long as they buy a 3-room or smaller flat, and get some proceeds from the move. So effectively, someone staying in a 3-room in a mature estate who wishes to move to a 3-room flat in a non-mature estate and can get some proceeds from that move will still be eligible for a SHB – a lateral move, but because you are moving from a mature estate to a non-mature estate and you unlock some proceeds, you can still be eligible for SHB.
Next, to receive the SHB, seniors must top up some proceeds from their move into their CPF Retirement Account. This is to ensure they have adequate savings for retirement. The top-up required today depends on their net sale proceeds, and we will simplify this, such that seniors only need to top up the first $60,000 of their proceeds.
Thirdly, we will increase the maximum cash bonus by 50%, from $20,000 to $30,000. So seniors will receive $1 in cash bonus for every $2 topped up to their CPF Retirement Account. So if you have sales proceeds, you top up $60,000, you will get $30,000 in SHB.
In line with the increase in SHB, we will also increase the maximum LBS bonus across all flat types. This means that owners of 3-room or smaller, 4-room, and 5-room or larger flats will get a larger bonus – the maximum cash bonus will be $30,000, $15,000, and $7,500 respectively.”
The Silver Housing Bonus was introduced to help elderly households supplement their retirement income when they right-size from a larger flat into a smaller one.
Currently, seniors can qualify for the SHB when they top up their CPF Retirement Account (RA) with part of the proceeds unlocked from right-sizing. The amount of top up required depends on the amount of proceeds unlocked. After making a first top up of $60,000, seniors may be required to make a second top up, depending on their remaining proceeds and RA balances. To qualify, seniors also have to be selling a larger flat and buying a 3-room or smaller flat.
The SHB will be simplified and enhanced. Seniors will only be required to top-up $60,000 of their proceeds to their CPF RA to qualify. (Under the enhanced SHB, proceeds is defined as the selling price of the current property minus the sum of any outstanding loan on the current property, the purchase price of the next flat, and resale levy payable.) There will be no second top up required. The requirement that they must be selling a larger flat will also be removed. Seniors can now qualify as long as they buy a 3-room or smaller flat, and they have proceeds from the move. (Private property owners right-sizing to a HDB flat can qualify if their private property has an Annual Value not exceeding $13,000.)
To better support seniors in their retirement, the SHB will be increased to $30,000, up from $20,000 today. This means that seniors will now receive a cash bonus of $1 for every $2 topped up to their CPF RA, instead of $1 for every $3 cash top-up. (Top-ups beyond the prevailing Full Retirement Sum (FRS) do not attract any cash bonus.)
Mr Wong announced various measures to make housing more accessible and to better support the diverse housing needs of all Singaporeans. Part of support for diverse housing needs involves streamlining monetisation options for seniors.
Besides Silver Housing Bonus, the maximum Lease Buyback Scheme (LBS) bonus will also be increased to $30,000 to align with the revised SHB. Currently, owners of 3-room or smaller flats, 4-room flats, and 5-room or larger flats can get a maximum cash bonus of $20,000, $10,000, and $5,000 per household, respectively. The maximum bonus quantum will be increased by 50% to $30,000, $15,000 and $7,500 respectively. (Seniors must top up at least $60,000 to qualify for the maximum LBS bonus. Top-ups beyond the prevailing Full Retirement Sum (FRS) do not attract any cash bonus.)
The enhancements to the SHB and LBS will take effect from March 4. Those who have applied for either scheme but have not yet received their bonus will also benefit, and can expect to receive the enhanced bonus from April 1 onwards.
MND and MOH said that they have been studying the concept of assisted living, where housing is integrated with care services. A series of focus group discussions was conducted last year to gather feedback from seniors and service providers. With positive feedback on the assisted living concept, HDB will proceed to launch the new flat typology in Bukit Batok in May 2020. This typology will come with a service package to support seniors to age in-place.
The block will be designed with large communal spaces on every floor, so that residents can gather with their neighbours conveniently. The flats, sized at about 32 sqm, will be enhanced with senior-friendly fittings and larger bathrooms, and other features to accommodate those with mobility needs. More details such as the service offerings, sales conditions, indicative flat prices and payment options will be shared in the coming weeks.
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