ALTHOUGH it was not directly addressed in Budget 2010, worries about the cost of housing in Singapore were reflected in several MPs’ speeches yesterday.
There were calls to review housing policies, including current rules that allow private property owners to buy HDB flats and to sublet them.
It was also suggested that the $8,000 household income ceiling be raised to allow more Singaporeans to buy new subsidised flats (that are not executive condominiums) from the Housing Board.
The growing number of new immigrants in recent years has caused not just a squeeze on jobs, but also on transport and housing, said MPs.
Mr Inderjit Singh (Ang Mo Kio GRC) said: ‘By bringing in too many people too quickly…the cost of living has gone up rapidly. The clearest manifestation of this is the cost of HDB flats.’
He said though permanent residents (PRs) cannot buy new flats, they still indirectly inflate prices. This is because demand by PRs in the resale market can push up prices, and the price of new HDB flats is pegged to the resale market.
There are also many PRs who rent HDB flats and this contributes to the upward pressure on flat prices, he added.
HDB resale prices have risen about 40 per cent in the past three years, far outstripping Singapore’s economic growth.
The Ministry of National Development has maintained that PRs, who make up only one in five resale flat buyers, have minimal impact on resale prices.
Yesterday’s debate also saw Dr Ahmad Magad (Pasir Ris-Punggol GRC) raise concerns on the effectiveness of recent measures to curb property speculation.
Three days before the Budget statement on Feb 22, the Government announced new rules: A property buyer has to pay extra stamp duty if he sells the property within a year; and the amount buyers can borrow from lending institutions was reduced from 90 per cent to 80 per cent of the property’s value.
Despite these measures, people are still thronging showrooms and snapping up properties, said Dr Ahmad.
He was particularly concerned about the policy that allows private property owners to own HDB flats as well. While the policy says they must live in the flats, anecdotal evidence shows many do not, and are renting them out. ‘If no stern action is taken, it will encourage more dual property owners to do the same,’ he said.
Mr Sin Boon Ann (Tampines GRC) wants the Government to review the income ceiling for a group of young Singaporeans – graduates who have worked a few years before deciding to settle down – struggling to buy a new HDB flat.
He argued that not all couples whose incomes exceed the current limit can afford private housing, or have enough cash to meet the down payment for a pricier resale HDB flat from the secondary market.
National Development Minister Mah Bow Tan said recently the Government was looking into measures for the HDB market and that announcements would be made in Parliament some time this week or the next.
Source : Straits Times – 3 Mar 2010
Frustrated buyers have pointed their fingers at permanent residents and private property speculators for pushing up HDB resale flat prices to record levels.They claim the speculators snap up resale flats and then rent them out illegally or sell them quickly but legally after the stipulated one-year period.
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