WHY 50K HDB RENTALS CAN’T BUY WHEN “LESS THAN 1K” CAN AFFORD?

1,800 earning less than $1,000 bought HDB

According to the Straits Times news report GE2015: PM Lee’s assurance on cost of living” (Sep 3) – “With more subsidies, the net price for a two-room flat is now $30,000 and many families have been able to afford it, he said. In the last four years, 1,800 families earning less than $1,000 a month have bought two-room flats.

“So when I say we have made housing more affordable to help people with the cost of living, I’m telling the truth.”"

50,000 HDB rental tenants can’t afford to buy HDB?

If even most people earning less than $1,000 a month find buying a HDB flat affordable – then, arguably why do we have more than 50,000 HDB rental flats that are rented by Singaporeans?

How many of the 1,800 families earning less than $1,000 who bought HDB flats in the last four years were HDB rental flat tenants?

From the cheapest to the most expensive public housing in the world?

Our public housing has arguably changed from being the cheapest public housing during our late former Prime Minister’s era, to the most expensive in the world – if measured by the price to wages ratio

Supply of HDB flats to meet demand?

The supply of HDB flats to meet demand was also an issue.

For example, whilst the total number of HDB flats grew by 201,755 or 25,219 per year, in the eight years from 661,163 in 1994 to 862,918 in 2002 – it only grew by 21,438 or 3,063 per year, in the seven years from 868,774 in 2003 to 890,212 in 2010.

In other words, the average increase in flats per annum declined by a whopping 88 per cent (3,063 divided by 25,219).

Huge population increase 

During this seven-year period when very few HDB flats were built – the huge influx of foreigners increased the population by a whopping 961,906 or 23 per cent, from 4.1 million to 5.1 million, from 2003 to 2010.

HDB prices

With this huge increase in the population – the HDB Resale Price Index increased a whopping 66 per cent or 7.5 per cent per annum during the same period from 75.1 in 2003 to 124.4 in 2010.

Housing problems compounded by low CPF %, wages, population increase?

Our public housing problems were perhaps compounded by the decrease from 6.5 per cent CPF interest to 2.5 per cent (the lowest real return amongst national pension schemes in the world since 1999), huge influx of foreigners, hardly any real increase in wages, etc.

We should relook the “great” policies like HDB and CPF implemented during the late former Prime Minister’s tenure – in the context of how they may have convoluted to become the key problems that Singaporeans have today?

 

 

Leong Sze Hian

A.S.S. Contributor

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