What is VERS (Voluntary Early Redevelopment Scheme)?

chloekks
12 minutes ago
3 min read

Your Guide to HDB's New 'VERS' Scheme

Hey everyone, you might have been hearing a lot about something called VERS lately, especially if you're living in an older HDB flat. It's a big deal for Singapore's public housing, and it's going to affect a lot of us in the long run. I've done a bit of reading on it, and I wanted to break it down in a simple way so we can all understand what's going on.

So, What is VERS, Anyway?

VERS stands for the Voluntary Early Redevelopment Scheme. In a nutshell, it's a new government program that will be offered to residents of HDB flats when their homes are around 70 years old. If your precinct is selected for VERS, you and your neighbors will get to vote on whether you want the government to buy back your flats before the 99-year lease runs out.

Think of it as a way to "cash out" of your flat before the lease expires and the value drops to zero. The government can then redevelop the land and build new flats for future generations.

VERS vs. SERS: What's the Big Difference?

You've probably heard of SERS, the Selective En bloc Redevelopment Scheme. For a long time, SERS was like the "HDB lottery." If your block was chosen, it was a pretty sweet deal. But VERS is a totally different ball game. Here's a quick comparison:

Feature	SERS (The "Lottery")	VERS (The "New Way")
Participation	Compulsory - you had no choice	Voluntary - you get to vote!
Eligibility	Flats with high redevelopment potential (very rare)	Flats around 70 years old (more common)
Compensation	Market value + generous grants	Less generous than SERS
Main Goal	Maximize land use	Manage aging flats and lease decay

The biggest takeaway here is that VERS is voluntary. This gives homeowners more power and a say in the future of their estate. However, the government has also been clear that the compensation for VERS will be less generous than SERS. This is because the flats are much older, and the goal of VERS is different.

How Will VERS Work?

The exact details of VERS are still being ironed out, but here's the general idea:

Selection: The government will select certain HDB precincts with flats around 70 years old to be offered VERS.
Voting: The residents of the selected precinct will vote on whether to accept the VERS offer. The exact voting threshold (e.g., how many "yes" votes are needed) hasn't been announced yet.
Compensation: If the vote passes, the government will buy back the flats. The compensation package is still being worked out, but it will likely be based on the market value of the flat at that time.
Relocation: Residents will then have to find a new place to live. The government has said they will try to build new flats nearby for residents to move into, but this isn't a guarantee like it was with SERS.

It's important to remember that VERS is a long-term plan. The first VERS projects are not expected to happen until the early 2030s, and the scheme will be rolled out gradually over the next few decades.

What Does This Mean for You?

So, what does all this mean for us as HDB homeowners?

If you live in an older flat: You now have a potential "exit strategy" before your lease runs out. However, you shouldn't count on a big payday like with SERS.
If you're thinking of buying an older flat: The "hope premium" for SERS is gone. You should now factor in the possibility of VERS when making your decision.
For everyone: VERS is a sign that the government is taking the issue of lease decay seriously. It's a more sustainable way to redevelop our older towns and ensure that there's enough housing for future generations.

Of course, there are still a lot of unanswered questions about VERS. How will the compensation be calculated? What will the voting process be like? How will the government help elderly residents who may have trouble finding a new home?

These are all things that the government will need to address in the coming years. In the meantime, it's important for all of us to stay informed and understand how these changes might affect us.

I hope this helps you understand VERS a little better! Let me know if you have any questions, and we can try to figure it out together.