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  • Maine Soh

4 Ways to Monetize Your HDB for Retirement

Updated: May 3, 2020

Many people understand the concept that it is not a wise investment decision to hold their HDB as the longer they hold the property, the more CPF accrued interest incurred. This means the amount of cash proceeds that you can get back will be lesser.

In addition, HDB owner do not have the option to re-deploy their dormant fund to work even if the flats are fully paid. So, many elderly couple have come forward to ask me what are their option to monetize their HDB for retirement.

Young couple will have ease in making the decision to monetize their HDB to upgrade to Executive condominium or Private Condominium as they are still holding higher salary and could obtain a higher loan tenure. Unfortunately our silver generation are facing the issue of missing the opportunity of getting sufficient cash proceed as they has hold their existing HDB too long and insufficient HDB or bank loan due to their age and their income.

Our silver generation bought their HDB when they are generally economical during their time. With the appreciation of the HDB flat, Our elderly couple are generally considered as asset rich but not cash rich.

In preparation for our growing aging population, Singapore’s government has implemented various housing monetization options to assist our elderly couple to redeploy the value of their existing HDB flat to complement their retirement needs

In this article, lets us assist my close relative, Mr and Mrs Teo in making an informed decision while exploring the 4 main ways our elderly couple can consider in taking action to unlock the value of their HDB flat in order to supplement their retirement income.

Based on True Story of Mr & MRS TEO


Mr Teo's Age: 70years old

Mrs Teo's Age: 64years old

Existing House : 4room at 122 Yishun street 11, # 10.

Purchase price: $194k in 2006

Market value Approximate: 325k in 2020

CPF used includes accrued interest for Mr Teo: 60k (rounded up figure)

CPF used includes accrued interest for Mrs Teo: 215k (rounded up figure)

The most fundamental thinking process of Mr and Mrs Teo, and all elderly couple are to decide if they would prefer to move out of the house or continue to stay in the house.

Source: HDB


1) Rent out spare bedroom (s)

When we stayed in a place long enough, it is inevitable that we would have grown sentimental value to the place we spend most of our time in, home. Thus, this option has been very popular to many elderly couple to simply rent out those spare rooms to earn room rental income.

This happens commonly when their children have moved out after married and purchased their matrimonial home. However, Mr and Mrs Teo enjoy their privacy. Staying with another stranger means they need to make adjustment to their lifestyle thus, they are unwilling to take this option.

2) Sell The Flat Under Lease Buyback Scheme

Source: HDB

Many people have heard about this term “Lease Buyback” Scheme but not many people understand how this scheme works.

This scheme provides the option for elderly couple to sell part of their HDB flat’s lease back to HDB. The length of the lease eligible to sell back to HDB should cover the youngest owner till 95years old.

In order to be qualify for this option, Mr and Mrs Teo will need to check the following eligibility condition

Source: HDB

On top of the Eligibility Condition, You may want find out exactly how it benefit you and what are the shortcomings from this scheme


  1. The proceeds collected from the process of selling part of the HDB flat’s lease back shall be used to top up owner’s CPF Retirement Account (RA), which in turn can be used to join CPF Life that provide elderly with steady stream of monthly income for life

  2. The option to terminate the lease prematurely will not terminate the CPF Life plan that provide monthly income

  3. Elderly couple could receive up to $30,000, $15,000 or $7,500 if they are selling the tail-end lease of their 3room or smaller, 4room flat or 5 room or bigger flat respectively.

  4. HDB will ensure individual who outlive the lease of their flat not be left homeless. HDB will work out an appropriate housing arrangement with you and family members after going through all circumstances such as health condition, financial status and family support.


  1. After deciding to sell the tail-end lease of the flat to HDB, you will not be eligible to sell the unit again in the open market or rent out the whole flat

  2. Termination of the lease prematurely will only be refunded for the remaining lease by pro-rated on straight line depreciation basis

  3. Each owner will need to top up their Retirement account (RA) to the Basic Retirement sum of $90,500 (as of 2020)

  4. The maximum cash proceed from the sale proceed is capped at $100,000. This means that if the sale proceed is more than $100,000, the remaining fund will need top up into CPF Life.

Mr and Mrs Teo are interested with this scheme but Mrs Teo will only turn 65 next year. Should they decide to take this option, they will need to wait till next year to exercise this option.


3) Rent Out the Whole Unit.

Moving Out from current flat and rent out the whole unit would allow the elderly couple to enjoy rental income.

A typical 4room flat in Yishun could rent at approximately $2000 - $2200 depending on the condition of the unit. Since the couple has not much expenses, with a rental income of average $2100 is good for them to sustain their living expense for the rest of their life.

However, this option requires the planning of them staying in their son house. Mr and Mrs Teo being a very considerate elderly couple decide not to interrupt their son's lifestyle based on their decision.

4) Right-Size to a smaller flat

If you are planning to move out of the house as the house is too big for you to maintain, you can consider to right size to a smaller flat. This is another popular option that many elderly chose if they fulfilled the following criteria.

Under this scheme, the elderly couple can benefit from Silver Housing Bonus (SHB) and receive up to $30,000 cash bonus. To qualify for SHB, the senior couple will both need to contribute or top-up $60,000 of their cash proceed into their CPF retirement account and join CPF Life.

The main consideration of above 4 options depends mainly on the planning of the elderly couple if they prefer to move out of the house or continue to stay in the house. It is a complex process but decision can be made easy if you are well informed.

Maine Soh holds a Bachelor’s Degree in Real Estate from NUS and has more than 10 years’ experience working as Real Estate consultant. While focusing on sales, she has attained consistent Top Achiever awards. She has always been known for being well versed with all the marketing strategy and tools. She will constantly make diligent effort to be updated with all the new trend and digital marketing platform to enhance the sales. She has assisted many of her clients throughout the whole process successfully by making informed decision and prevented them from making avoidable mistake.

Feel free to call me for a 1 time free consultation today!

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