I have been thinking about it for some days and I do feel that the Lease Buyback Scheme ought to be further improved if possible. For one, they should perhaps extend it to all Singaporeans to make it easier for older Singaporeans to liquidate the tail-end lease of their HDB flats. After all, not many people are ready for retirement in Singapore.
Renting Out
Another way that people can generate income from their property or HDB flat will be to rent out the entire flat or rent out certain rooms.
A person is allowed to rent out the entire flat after living in it for a certain number of years. (5 years if subsidised and 3 years if unsubsidised). Approval is required from HDB to rent out the flat. A higher property tax of 10% will be chargeable if you rent out your entire flat.
Alternatively, one can also rent out one or more rooms in your property or HDB flat with no change to the property tax payable.
Generating income from your property during your retirement years is fairly easy. However, one should realise that there are also certain risks and downsides involved:
1. Bad tenants (illegal immigrants, overstayers, people who don't pay rent, tenants who spoil your property).
2. Conflicts when living with tenants.
3. Lack of privacy.
Plan early and well for one's retirement so that there is no need to monetize one's home for retirement. Really sad if one have to do it at such an old age.
ReplyDeleteRental income adds to your annual income, and therefore a higher income tax.
ReplyDeleteW
True true. I should have highlighted that.
ReplyDelete