HOUSING AND DEVELOPMENT BOARD FLATS (Reverse mortgage for the elderly)

Column No : 2111

HOUSING AND DEVELOPMENT BOARD FLATS

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(Reverse mortgage for the elderly): **

26.

Mdm Ho Geok Choo asked the Minister for National Development if he will provide an update on the proposed plans for HDB to allow elderly home owners to do a reverse mortgage of their HDB flats to enable them to buy an annuity.

Mr Mah Bow Tan: MND and HDB have been exploring reverse mortgages as a possible way to provide elderly HDB lessees with an additional source of income for their retirement needs. For reverse mortgage to work, the scheme must be commercially viable, and offer sufficiently attractive terms for elderly HDB lessees. We have met up with the industry associations and several industry players to discuss this matter. We hope they can offer a scheme that will meet the needs of elderly lessees.

Elderly lessees can also make use of other existing schemes to derive income from their HDB flat. For example, they can sublet their entire flat or a room in their flat, if they satisfy certain conditions such as length of occupation of their flat. Flat lessees can also sell their existing flat and move to a smaller flat or Studio Apartment. They can use the income or sales proceeds they obtain to purchase an annuity.