Tag Archives: HDB News

Protect the interests of first-time home buyers

Posted on 30 Sep 2009 | Comments Off on Protect the interests of first-time home buyers

I APPLAUD Miss Tan Hui Yee’s commentary yesterday, “Go back to basics for affordable flats”.

An HDB flat is more than just an asset; to many Singaporeans, especially first-time buyers, flats are their humble abode, their place of security. The convenient call to lower expectations cannot hold if the yardstick for affordability varies between the authorities and buyers.

The steady rise in the standard of living has led to a general increase in household incomes; however, the trend has been balanced out by a corresponding rise in the cost of living.

The recession and higher prices have led to home-seekers being unable to purchase flats, because a home loan would place an additional financial burden on them.

For speculators and investors, public housing has turned into a money-spinning tool – be it in terms of rental or investment. If the authorities sustain or even increase the value of public housing, demand and prices would continue to spiral upwards. Home prices in Singapore have soared in recent months, with transactions hitting record monthly highs. This could lead to a real estate bubble and buyers paying extremely inflated prices for their first homes. Continue reading →

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Go back to basics for affordable flats

Posted on 29 Sep 2009 | Comments Off on Go back to basics for affordable flats

WHAT does ‘affordable’ mean?

With rising home prices hitting headlines in recent weeks, Singaporeans are falling over themselves trying to pin down affordability.

The Government, which built its reputation housing a nation, has defended its record. It says that public housing is affordable because new home owners use less than 30 per cent of their income to service their housing loans.

While this is persuasive, public scepticism has been just as strong. The gap exists because there is no agreement on what ‘affordability’ means.

The Government feels flats are affordable because those who applied for them will not be paying through their noses. But this, however, does not take into account home seekers priced out of these flats in the first place.

Many home seekers, meanwhile, feel aggrieved because an HDB flat that does not require a long commute to work is getting out of reach.

Furthermore, a study by National University of Singapore economists Tilak Abeysinghe and Gu Jiaying published last year found that the buying power of people’s lifetime earnings in 2007 was lower than it was in 1990 when tracked against the prices of HDB resale flats. By this measure, the prices of HDB resale flats have become less affordable. Continue reading →

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