SERs and VERs (Part 1 - Vision to uplift 90% of population dwelling in HDB) - REACH

12 Jan 2023

1. 90% of Singapore population mainly made up of low and middle income group live in HDB flats.

And their wealth assets are predominantly lock up in their HDB flats that they may have paid up after 20 years (with little liquid assets).

2. Hence if the Government is to set the goal of uplifting 90% of the population - low and middle income group into a higher income group - monetising the HDB flats of these groups upon HDB flats lease decay through SERs or VERs will be the only way to achieve this goal.

This will make the 90% population happy - and further solidify the governance of the incumbent Government.

Government will also spend less in setting aside welfare benefits to help the lower and middle income groups.

3. Note that about 10% of the population live in private condo, landed properties - achieve windfall benefits from en-bloc upon the lease decay - as developers bid high price for the en-bloc as Singapore lands is a premium being a little red dot and a highly successful Economy in which properties are highly sought after assets by local and foreign investors.

The HDB dwellers are currently unhappy why SERs and VERs cannot achieve the same effect of private properties en-bloc - as the Government previously touted HDB flats - as Asset Enhancement, Wealth Enhancement - especially so for low and middle income groups in which HDB assets is their only high-valued worthy possession.

4. Accumulate wealth and uplift low and middle income group through SERs and VERs must have 3 pre-requisite to be successful :-

a. HDB owners must achieve monetary benefit from SERs and VERs exercise (just like private condo or landed properties en-bloc).

b. Government must be able to finance SERs and VERs - and this can be achieve through monetary benefits from the SERs and VERs shared with HDB owners (such as return of grants and a percentage cut from the SERs and VERs per HDB units) from renewing the 99 years lease. Government still retain control of the State Lands as HDB flats lands belong to the State.

c. Young couples without assets and have just join the workforce - must be able to afford to buy new flats or resale flats to start a family through Government grants upon rebuilding via SERs or VERs - as the flats rebuild through SERs and VERs will like see a price hike.

These 3 pre-requisites look like 3 opposing states that cannot be achieve together - can be achieve if it is done creatively (similar to quantum mechanics of qbits and superposition through quantum entanglement of 4 opposing states 00, 11, 10, 01).

5. If this goal of uplifting the 90% of population through SERs and VERs is attained - a true "Wealth Transfer" to resolve "Income, Social Class Inequality" in Singapore will be achieved.

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SERs and VERs (Part 2 - Monetising SERs and VERs)

12 Jan 2023

1. SERs and VERs must achieve 3 objectives :-

a. Monetise HDB flats upon lease decay - with monetary benefits to HDB owners.

b. Government must be able to finance SERs and VERs - and in fact reap monetary returns to ensure healthy fiscal budget and accumulate reserves.

c. Young couples must not lose out as HDB flat price increases as a result of SERs and VERs due to high price payout to HDB owners and contribution to Government revenue.

(This will attain the overall mission of "Asset Enhancement and Wealth Transfer" to HDB dwellers that are made up low and middle income groups.)

2. To achieve all these 3 objectives, let us explore how SERs and VERs can be carried out. Specifically VERs (that are similar to private enbloc - where house owners need to vote above 75% to grant en-bloc).

a. Upon lease decay before 99 years, with successful vote to VERs, plot of land are enbloc under 2 options:-

i. Government based on market valuation by independent market valuers determine the price of the plot of land - will then pay each HDB owners according to the land price valuation.

ii. Invite private developers BTO to bid for the land price for rebuilding and successful bidders pay each HDB owners according to the successful bid price.

(Note:- Both options achieve the same effect of private enbloc - and will achieve 2 SERs and VERs objectives :-

a. HDB owners will reap the enbloc SERS and VERS monetary payout by either the Government or the BTO private developers.

b. Government will take back the government grants of these HDB owners plus take a percentage cut (eg. 5% to 10% of the monetary payout from each HDB owners)

3. a. HDB owners will then buy or lease another HDB flats (usually at a lower price) to stay for their remaining lives and save their remaining SERs and VERs payout - and achieve increase in wealth.

b. Government does not have to fork out additional money from its fiscal budget or dig into reserves to finance SERS and VERS - and in fact earn revenue through return of HDB grants as well as percentage cut payout from each HDB owners from SERS and VERS.

c. Then how to keep renew HDB flats under SERS and VERS price affordable to young couples as well as older couples who have sold their flats under SERS and VERs - as well as how to make SERS and VERS profitable for BTO developers to take up the project?

i. Most HDB flats lease coming to 99 years are 15 floor flat.

With height restriction removed (eg. Paya Lebar airport move to Tengah) - most flats can be build more than 15 floor - which in fact can be built up to 30 floor.

This means the foot fall for the same plot size of lands - can build double the amount of flat units -- and can make the higher payout of enbloc profitable for BTO developers.

ii. BTO developers can sell twice amount of flat units in the same footfall land area. When this happen, the flats can be price at affordable level - without greatly impacting young couples who are buying the new flats from SERs and VERs.

This will help to achieve the 3rd objectives of SERS and VERS - keeping the flats affordable to young couples despite doing SERS and VERS in mature estate upon lease decay. Although the price could be higher, Government can help by giving more grants to the young couples to own the flat.

4. Now the above proposal will resolve the 1st generation 1960s 99 years lease problem for at least the 1st 100 years of lease decay problem.

5. The only headache will be the next 100 years when the next wave experience the same lease decay after 99 years -- because 30 floor flats is the maximum height limit achievable.

We can't use the same idea to build a 60 floor flats to solve the problems and achieving the same 3 objectives.

Will have to wait for another Enlightened One - to come up with another Quantum ideas to resolve the next 100 year lease decay......

6. But as of now, the Government will have make all Singaporeans rich - not only the 10% private property owners from private enbloc who are from high income group but also the 90% public flat dwellers that made up of low and middle income group.

The Government will have succeeded to uplift the whole current generation of Singaporeans from low, middle and upper income group - with 1 big swop through the SERS and VERS.

（九品莲花生 - 9 realms of upper-upper, middle-upper, lower-uppler; upper-middle, middle-middle, lower-middle; upper-lower, middle-lower, lower-lower; income groups)

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