What elderly flat buyers need is a waiver of the resale levy on their new flats ("Pay less cash upfront for small BTO flats"; last Thursday).
Currently, if flat owners wish to downsize, they have to pay a resale levy of $40,000 if they have a four-room flat, or $45,000 if they have a five-room flat.
This is not a small amount for the elderly, and any savings from staggered down payments pale in comparison.
Those buying studio apartments are exempted from the resale levy. Why can't the HDB do the same for two- or three-room flats?
Also, according to the report, to be eligible for the scheme, buyers should not have completed the sale of their existing flats when applying for the new ones.
But what if they cannot sell their flats in time when their new flats are ready?
The HDB should allow them to sell their flats first before applying for a new one.
If the new flat is not ready by the time the current flat is sold, the HDB should offer a rental unit at a subsidised rate.
It would be hard for the elderly and the poor to monetise their flats if they have to pay the resale levy and cannot sell their flats beforehand.
The Government should be more flexible in its policy.
This article was first published on Sept 29, 2014.
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