Older HDBs: Bigger, Cheaper... But At What Cost?

Older HDB View

Why I’m Writing This

Honestly, I just felt a nudge to share this. Maybe it’ll help someone, or a family, make a more informed decision.

Who This Is For

If you’re wondering whether to buy or continue holding on to an older HDB flat, this is for you.

What I’ll Be Covering

• Why older HDBs aren’t as straightforward as they seem

• How lease decay can affect your retirement

• What you must know to make better property decisions

  
  

The Consideration Around Older HDBs

One common thing I hear when talking to homeowners:

"Old HDB flats are bigger and cheaper, confirm more worth it, right?"

Yes, on paper, a 3-room flat from the 1980s can be about the size of a modern 5-room BTO. But here’s the catch: if your flat has 60 years or less remaining lease, the value might slowly decline.

Why?

CPF Usage Gets Limited

If your age + remaining lease doesn’t add up to 95 years, your CPF usage is restricted. This means:

• Fewer buyers can use CPF to buy your place

• Pool of potential buyers shrinks

• Demand drops, and when demand drops… so does price

It’s simple economics: limited demand + increasing supply = weaker resale value. Ive covered this topic of demand and supply here

How It Affects Retirement (Yes, Really)

Another important point — lease decay impacts valuation.

Valuers often use something called the BALA curve (you can Google this). It basically charts how property value drops as the lease runs down. So if your flat is aging, your paper value might be dropping too.

You might think:

“I don’t intend to sell, I’m staying here until old age. So no problem.”

I’ve seen this mindset backfire too many times in my years as a realtor.

What if life throws you a curveball? Job change, family needs, health issues — suddenly you have to move. And now you’re looking at a possible loss, or at best, breaking even.

A True Story

I once helped a client who had to sell her aging HDB. It was a breakeven sale — barely. Seeing her scramble to finance her next home was heartbreaking. It could have been avoided... if there was a proper plan from the start.

Just using CPF to pay your mortgage isn’t a plan.

What You Need To Know

We can’t approach older HDBs like how our parents did in the past. Those were different times — now, you need to be strategic.

Here are the 3 key things to get right:

1. Know Your HDB Asset Health

What’s your flat worth now? What’s the future forecast based on the lease?

2. Finance It Smartly

Don't just dump all your CPF in — structure it well so your money can work harder elsewhere too.

3. Have a Property Journey Plan

Where are you now? Where do you want to be in 5, 10, or 20 years? What’s your exit strategy?

I really hope this gives you something to think about. Don’t just hold an old flat because it’s big or cheap — have a plan behind it.

If you already have an agent you trust, sit down and talk with them. And if you don’t, feel free to reach out to me. I’ll be happy to help.