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Hi, my father (widow) owns a fully paid 4-room HDB flat in Jurong West near NTU. Due to his medical condition, he is staying in a nursing home long term and I am renting out his flat @$2,200 per month to help finance his nursing home fees. I have my own flat and have Lasting Power of Attorney to act on my father's behalf for his properties.

I am just weighing the odds of whether it makes more economical sense to sell his flat which has less than 60 years lease left or continue renting out for stable passive income. Either way, I just want to make sure he can be supported well financially in his later years.
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2 Answers

Good afternoon,

Hope he is recovering well. Imho, for flats with balance lease less than 60 years the value may not hold up well especially at a location that is not central. It is also unlikely hdb prices will appreciate further given the government's strong stand to keep hdb prices affordable and sustainable. The rental income is helpful but in the long run the gains are offset by the gradual depreciation of the property. Another factor also to consider is if the property may hold sentimental value for him as well.

May I have more info and requirements about your plans so to make better recommendations? Thanks and look forward to value-add to your housing plans.

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Ivan Ng Realtor ASAP
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Dear sir/madam,

Valuation perspective, it makes more sense to look into liquidating this asset soon due to its age of below 60 years balance. While the unit is still being marketed, you may wish to strike an agreement with current tenants on frequency of viewing so as to facilitate the process while minimising the inconveniences to them, since we are aware that response to units with shorter lease balance usually takes a longer time to match to a right purchaser, therefore the entire process can be a drag and cause some disturbances to the tenant, but we also do not want you to lose the existing rental which you are receiving.

It will be better if we can know more details about your existing rental on top of the unit details to understand the numbers behind the whole transaction in order for you to make a more informed decision moving forward.

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