“Time to take a hard look at HDB’s increasingly conflicting mandates” (Go Back To Basics For Affordable Flats, Miss Tan Hui Yee).
I would like to applaud the excellent article, “Go Back To Basics For Affordable Flats” (September 29, 2009), by Miss Tan Hui Yee.
A HDB flat is more than just an asset; to many Singaporeans, especially first-time buyers, flats are a form of assuredness, of humble abode, and of security. The convenient mantra of “lowering expectations” cannot hold if the yardstick for affordability varies from the authorities to the initial buyers at the foot of the property ladder. While the steady rise of the standards of living has led to a general increase in household incomes, the corresponding rise of the costs of living – while subtle – has somewhat eroded the former trend. The notion of upgrades and enhancements is a blurred one, because it is difficult to place a monetary value on these factors.
Moreover, with the current recession, the higher prices would render home-seekers unable to purchase flats, because loans would create additional financial burdens on their expenditures.
For many speculators and investors today, public housing has turned into a money-spinning tool; be it in terms of rental or investment. If the authorities persistently pursue the path of sustaining, or even increasing, the value of public housing, the trend of increased perceived demand and higher prices would continue to spiral upwards. Home prices in Singapore have soared in recent months, with transactions hitting record monthly highs. Not only would this inflate a potential real estate bubble, but also cause buyers to fork out extremely inflated prices for their first homes.
The mentality and unreasonable expectations of raking in huge profits by home-owners are assumptions that should be addressed, and not allowed to be manifested. Remember, public housing was predicated on the belief that every Singaporean deserves an affordable and safe shelter above their heads. It is not a monetary tool meant to be exploited by hungry pragmatists and investors.
Ultimately, the authorities should crucially safeguard the interests of the first-time buyers, particularly so because the commercialisation of public housing results in them forking out more money for speculators and investors. The dominance of public housing in Singapore (almost 95%) premises the urgency and need for the authorities to introduce measures to strike equilibrium between helping first-time home buyers, and sustaining home values in the long run.
A version of this article was published in The Straits Times.