Earlier in the year, you may have read about how 4 ageing blocks in Ang Mo Kio were chosen for the Selective En bloc Redevelopment Scheme (SERS). In case you missed it, the TLDR is that there are a total of around 606 units affected, and that the news was met with much buzz and interest given that the last SERS announcement was all the way back in 2018.
However, ever since then, there have been several hiccups along the way, mainly due to how the affected residents realised that they were sort of on the losing end of this SERS announcement. Of course, this shouldn’t be the case, given that part of the SERS process would involve affected residents being adequately compensated by the government for the trouble and hassle involved in selecting and moving into a new flat.
After much to-and-fro between the HDB and the affected residents, it was reported just yesterday that the actual compensation that the latter will receive will be about 7.5% higher than initial estimates. Here’s everything you need to know to bring you up to speed on the latest developments involving the AMK SERS.
Compensation for SERS
Before we dive into the latest news, here’s a quick explanation on what compensation component for SERS actually entails.
After your block is selected for SERS, HDB will send down professional private valuers to assess the market value of your flat. In short, they’ll take into account factors like your floor area, which floor you’re located on, the orientation of your flat, and some other factors which will determine the market value of your flat. This also includes factoring in recent market movements, and recent sales of similar flats in the vicinity.
Image credit: @v.ii.n.s
Subsequently, HDB will notify you of the compensation quantum you’re entitled to, based on the assessed market value. Depending on your eligibility, you can also get additional waivers and grants – termed as Reasonable Expenses – on top of that compensation amount, such as an extra $10K for removal of bulky furniture or even a separate SERS grant of up to $30K to offset some costs of your replacement flat.
What was the fuss about?
This is where things start to get a little murky.
As part of the SERS process, residents meet with representatives from HDB to discuss the amount of estimated compensation that they are entitled to as well as rehousing options (e.g. moving into the SERS replacement site, finding a new flat elsewhere, etc.). Note that these are estimated amounts; the actual quantum will be shared with them once the professional valuers have completed their assessment later on in the process.
Image adapted from : Google Maps
According to reports, when the affected AMK residents had that meeting with the HDB, some were informed that in order to move into a similar-sized unit at the SERS replacement site, they would have in fact had to fork out additional money, which was not something they’d expected. Of course, this came as a shock to them, especially considering that some had to cough up as much as an additional $150K in order to move into a similar 4-room flat at the replacement site.
Interestingly, this is not the first time in which this scenario has occurred, where the cost of moving into a SERS replacement site is higher than the compensation amount they are entitled to. Imagine having to effectively be ‘forced’ out of your current home, and while you do get a new home with a fresh 99-year lease, you still have to come out with additional money for a similar-sized home at a location that may or may not be favourable to you.
Given that quite a number of affected residents are elderly folk that have been living in these ageing flats for many years, one of the concerns raised was that they wouldn’t be able to finance the additional amount, either via home loan or otherwise. Naturally, this episode caused quite a bit of upset and dismay to the residents. This led to many conversations in the media, and even being brought up in Parliament.
Higher compensation amounts than previously estimated
Fast forward to today, and it seems that the residents have managed to get some reprieve from their situation.
In a statement by the HDB, the affected AMK residents were notified that they would be receiving a higher compensation amount than what was previously estimated, and as high as an additional 7.% from the initial estimates.
HDB also explained that these higher compensation amounts were due to 2 main reasons. The first was because of the final assessments by the professional valuers, and that well-renovated and maintained flats would generally command a better value than those in a poor state. The second is because of market movements between Feb 2022 when these estimates were made, and Apr 2022 when the announcement was out.
2 new rehousing options
On top of the higher compensation amounts, HDB announced that it was introducing 2 new rehousing options which were first announced in July this year, for those who chose to move into the SERS replacement site.
First, residents can go for a shorter 50-year lease as long as it is able to last the youngest listed owner until age 95, meaning they would have to be at least 45 years old in order to go for this option. Otherwise, elderly residents aged 65 and above can choose to go for the Lease Buyback Scheme for their existing homes, and subsequently buy a replacement flat with a shorter lease.
Of course, the pre-existing rehousing options are always available, where residents can opt for a brand new flat with a fresh 99-year lease. Or, if they choose to not move into the replacement site totally, they can use their SERS compensation benefits to buy a BTO, SBF, or resale flat.
Ang Mo Kio SERS update
To wrap up, HDB reported that over 90% of the affected AMK residents have already been successful in applying for a new flat with their SERS benefits. With this latest announcement, the next step for them would be registration for the new flats at the replacement site in Q1 2023, and subsequently, booking of the new homes in the later part of next year.
Don’t be SER-prised by the news, read more about SERS here:
- Ang Mo Kio Has 4 HDB Blocks Selected For SERS, The First In Over 3 Years
- HDB En Bloc (SERS): Will Your Home Stand A Chance?
Cover image adapted from : Google Maps