What Happens If, a SingSaver series, lays bare all the likely personal finance scenarios that could hit you at any stage of your life. After all, it never hurts to be prepared.
From the coveted compensation amount to the entire process of SERS, we’ll take you through what SERS is really all about and whether your HDB might be the next one selected.
For the uninitiated, undergoing an en bloc (be it living in an HDB or private property) may be deemed to be extremely inconvenient and headache-inducing. But there are also others who are constantly praying for one, especially since a successful en bloc could result in a huge windfall, like the Dublin Lodge that launched with S$67.55 million in February 2021. Currently, People's Park Centre is also up for collective sale.
However, with only 4% of all HDBs that got chosen for the Selective En Bloc Redevelopment Scheme (SERS) since 1995, maybe it’s best you don’t get your hopes up. Regardless of your stance towards en bloc, here’s all you need to know about SERS for HDB dwellers, just in case your block gets selected.
Here’s an overview of what you can expect:
- What is a HDB en bloc (SERS)?
- Why do people hope their HDB gets en bloc?
- How much is the compensation for SERS?
- Difference between SERS and en bloc?
- Does my property have SERS potential?
- How does the process of SERS work?
What is HDB en bloc (SERS)?
SERS is an urban redevelopment strategy that is essentially the HDB counterpart of en bloc. It happens when the government decides to take over the entire HDB development (usually older ones) to renew or redevelop it.
If your HDB gets selected for SERS, you’ll be relocated to a new HDB replacement site with a new 99-year lease, or other housing options like a Build-To-Order flat or a resale flat according to your preferences. On top of getting compensated, the price of the replacement site unit will also be sold at a subsidised rate to owners.
Why do people hope their HDB gets en bloc?
For most, they would believe that getting selected for an en bloc would be akin to striking the lottery, as they will be compensated handsomely. As the government is buying over your flat, they will compensate you according to market value. You’ll also get a SERS grant and fee waivers, essentially making it a lot more affordable than when you move on your own.
Aside from the monetary compensation, it also means getting a new flat that comes with a new 99-year lease, usually within the same neighbourhood, and sold to you at a subsidised rate. Though some may think of it as an unnecessary hassle, others would be excited about the idea of a new home.
How much is the compensation given for SERS?
You’ll be compensated based on the valuation of the house at market value, which could depend on factors like the floor of the unit, renovations done to the home, size and type of the unit, length of lease remaining as well as past transactions done in the area.
On top of that, you’ll be given a S$30,000 SERS grant to offset the price for your replacement flat, S$10,000 for removal allowance, and compensated for stamp duties and conveyancing fees. Additionally, if you’re planning to renovate your new home, you can also request up to $35,000 to offset the costs.
Difference between SERS and en bloc?
The term ‘en bloc’, also known as collective sale, originated from French, and translates to ‘as a whole’ or ‘in a block’. En blocs are only for private properties, where the government or a property developer wants to buy over the property for redevelopment. The HDB counterpart is known as SERS.
In the case of an en bloc, both the property developer and residents can initiate one, so if you think your property is worthy (and want some extra cash), you can gather up willing parties and create an en bloc committee. Residents living in the property chosen for an en bloc are also compensated above market value, which can go up to millions, making it highly coveted.
|How is it chosen?||Chosen by government||Initiated by a property developer or residents|
|Property being sold||HDB||Private property|
|Buyer||Government||Property developer or government|
|Agreement||Residents have no say||Residents have a say in whether they are in agreement or disagreement(at least 80% in agreement for property more than 10 years old and at least 90% for property less than 10 years old)|
|Compensation||Compensation at market value and guaranteed relocation||Compensation above market value|
|Relocation||Guaranteed relocation to a brand new 99-year lease HDB nearby (new home will be sold at a subsidised price)||House hunt yourself|
|Sale process||2 or more years||1-2 years|
Does my property have SERS potential?
Before we jump into the factors that determine whether your HDB flat will be chosen for the next SERS, here are the latest HDB flats that were selected in past years, with the most recent being just this year.
|SERS HDB Site||Blocks||Date of announcement|
|Ang Mo kio Drive||562 to 565||7 Apr 2022|
|MacPherson Lane||81 to 83||31 May 2018|
|West Coast Road||513 to 520||3 Aug 2016|
|Tanglin Halt Road / Commonwealth Drive||24 to 32, 33 to 38, 40 to 45, 55 to 58, 60, 62 and 66||27 June 2014|
|Woodlands Centre Road||1A and 2A||25 June 2012|
|Boon Lay Drive||167 to 172||29 December 2011|
|Redhill Close||1 to 3, 5 to 22||3 December 2011|
#1 Age of flat
For your flat to qualify and be selected for SERS, it should be 50 years and older. This is so the government can renew it or redevelop the land. So if your flat is still relatively young, tough luck!
#2 Location of flat
Aside from being old, your flat also has to be situated in a good location for the government to deem it worthwhile to redevelop the plot of land. One good indicator would be its proximity to an MRT station - one of the top factors of fetching a good flat price.
#3 How well-utilised it is
More often than not, flats chosen to undergo SERS are not efficiently used. This could mean that the blocks are located too far apart or are low-rise, typical of older HDBs that were constructed way back. In these cases, the government would be more incentivised to take over these developments and rebuild them to become more densely packed and well-utilised.
If you’re starting to get hopeful about your block getting selected, I’ll have to burst your bubble. The likelihood of that is pretty slim since SERS follows strict criteria and is subjected to the availability of a replacement site as well as the government’s financial capabilities.
But if you’re currently on a house hunt, you can consider purchasing a BTO flat. BTO flats are known to have a potentially high profit margin since they are new, and would also typically be cheaper to renovate. Aside from that, resale flats are also a strong contender since you can get them a lot sooner than a BTO flat. However, if you’re tight on finances, maybe it wouldn’t be a good idea to opt for one now due to the sky-high COVs that might eat into your budget quite a bit.
My HDB got chosen for SERS, now what?
#1 Announcement of SERS
First things first, you’ll receive a notification that your HDB flat has been selected to undergo SERS.
#2 Visit the SERS exhibition
A SERS exhibition will be built near your home. Feel free to visit the exhibition and fire away with any burning questions that you have. You’ll also get to learn more about the entire process of SERS and what you can expect.
#3 Flat valuation
Knock knock! A valuer will come down to your flat to access its value, which will then determine the amount of compensation you receive from the government. (Quick tip: keeping your house tidy and neat can help to bump up your valuation.)
#4 SERS Connect (collector’s inquiry)
Head down for your appointment at HDB Hub, where you’ll meet the HDB officer-in-charge who will perform the Collector’s Inquiry. This is when all the necessary paperwork is carried out to validate you as the owner of the flat. The officer will also go through financial planning with you for the flat replacement, and conduct a survey to help the government decide which replacement flat will best accommodate your needs.
#5 Precinct survey
You’ll go through a precinct survey to decide what kind of facilities and amenities you want to have in your new neighbourhood. You’ll also get the chance to name your new flat!
#6 Compensation notice
HDB will inform you of the amount of compensation you’ll receive.
#7 Choose your rehousing option
At this stage, you can select your rehousing option (replacement site, BTO or resale) with the HDB officers helping you through every step of the way. Instead of the SERS housing benefits that you’re entitled to, you can choose to receive an ex-gratia payment of up to S$60,000 instead.
#8 Register for a new flat
For those who prefer to move to the designated replacement site, this is when you can register for a new flat by submitting an application.
We all know that the community is more important than the flat itself. So If you’ve got neighbours you can’t bear to leave behind, don’t fret. Under the Joint Selection Scheme, you and six households can select the flat on the same day to continue living close to one another.
#9 Selecting your new flat
Head down to HDB for an appointment to book your new flat. Don’t worry if you don’t have much information - sales brochure, price lists and balloted queue numbers will be provided before you select your new home.
#10 Key collection
Finally, it’s key collection day! Head down to HDB Hub to collect your key and make payment for your new flat. You can use the money that you received as compensation for the SERS acquisition.
Do note that you’ll also have to pay off your outstanding loans and top up your CPF if any of these funds were used to help pay for your current flat. You can also submit a request at this stage to offset up to $35,000 of the renovation costs for your new home.
#11 Moving out
After you’ve collected your key, you have up to four months to renovate and move into your new flat. When you return your SERS flat, you’ll also receive the balance compensation (if any). Congratulations on your new home! The whole process is finally complete.
Read these next:
Cost To Buy Your First Home In Singapore
HDB BTO Launches In 2021
HDB BTO, SBF Or Resale: Which Should You Pick?
What HDB Flats Can Singles Buy?
Average Cost Of Home Renovations In Singapore
Money Mysteries: What Happens to Your Money During an En-bloc Sale?
HDB Minimum Occupation Period Guide For Homeowners In Singapore
Don’t Assume Old HDB Flats are Eligible for SERS
Why Singaporeans Are Angry About Not Owning Their HDB Flats
What Happens If: Your 99-year Housing Lease Runs Out?
Your HDB Flat Might Not Actually Be An Asset
Why Can’t We Agree on Whether Housing in Singapore is “Affordable”?
HDB Ownership After Divorce: What Happens Next?