The Home Improvement Project (HIP) is in full swing, and a whole bunch of flats are about to be blinged up. Here’s what you can expect from next year onward:
Over $1 billion to be spent on HIP for HDB flats
The HIP, which we explain in detail in this article, is all about upgrading your flat. It consists of both essential maintenance, and some optional upgrades like new grilles, senior-friendly bathrooms, etc. (upgrades bought this way are much cheaper than if you were to hire a contractor yourself).
According to Minister for National Development Lawrence Wong, the government is spending over $1 billion on the programme over the next few years. This will cover about 55,000 flats. Besides benefitting flat owners, the infrastructure project also supports local companies (because have you seen the state of the economy lately?)
Who gets HIP this time around?
The previous round of HIP targeted flats with a latest completion date of 1986. For the next batch of HIP upgrades though, the government is targeting flats that were completed between 1987 and 1997. Besides the first batch of 55,000 flats, there are another 175,000 in this category; these will be worked on in batches, till about 2029 or later.
(The previous round, for flats completed up til 1986, took around 13 years).
So if your flat is around 30 years old, chances are you’ll be getting the details in your mail shortly.
Will this help older flats appreciate in value?
It doesn’t hurt.
As we’ve mentioned before, HIP may not directly raise the value of your flat, but it goes a great deal toward maintaining it. The combination of HIP, plus relaxed CPF rules for older flats, can go a long way toward helping flats maintain their value. This is much needed in the current environment of stagnating resale prices.
And since some of you are going to wonder, here’s a look at the value of flats built between 1987 and 1997 right now:
Average prices of three-room flats completed between 1987 and 1997 have appreciated by over 77.6 per cent in the last 15 years, to about $458,000.
Four-room flats in the same category appreciated around 67 per cent to about $388,000, while five-room flats appreciated about 68 per cent to $510,600.
Executive flats from the same era appreciated almost 70 per cent over the past 15 years, averaging around $642,400 today.
As with property prices in general, you can see that prices started to flatten out after the last peak in 2013. There are many reasons for this, including the diminishing of Cash Over Valuation (COV), growing supply, and quite recently growing worries over lease decay. Still though, we can see prices are capable of rising, even for relatively old flats.
The next few decades will be interesting though, and a real test of whether old flats can hold their value. This will be especially true for the next two generations, who are likely to see the first lease expiry effects.
Do you have an older flat? Voice your thoughts in our comments section or on our Facebook community page.
Looking for a property? Find the home of your dreams today on Singapore’s largest property portal 99.co! You can also access a wide range of tools to calculate your down payments and loan repayments, to make an informed purchase.
Looking to sell your property?
Whether your HDB apartment is reaching the end of its Minimum Occupation Period (MOP) or your condo has crossed its Seller Stamp Duty (SSD) window, it is always good to know how much you can potentially gain if you were to list and sell your property. Not only that, you’ll also need to know whether your gains would allow you to right-size to the dream home in the neighbourhood you and your family have been eyeing.
One easy way is to send us a request for a credible and trusted property consultant to reach out to you.
Alternatively, you can jump onto 99.co’s Property Value Tool to get an estimate for free.
If you’re looking for your dream home, be it as a first-time or seasoned homebuyer or seller – say, to upgrade or right-size – you will find it on Singapore’s fastest-growing property portal 99.co.
Meanwhile, if you have an interesting property-related story to share with us, drop us a message here — and we’ll review it and get back to you.
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