In land-scarce Singapore, a skyrocketing demand, combined with a dwindling supply, has lead to the ever-rising cost of public housing, and equally high levels of public discontent.
(Will this be the 'public housing' election? The political parties make their cases below. Image courtesy of Singapore Tourism Board.)
The issue of affordable public housing is probably one of the only areas where the governing People's Action Party (PAP) is vulnerable to opposition pressure. Recent surveys have shown that the majority of Singaporeans do not think that public housing is being kept affordable for most, and that 'government
attempts to keep the cost of living affordable as an area of concern'.
These concerns are legitimate, a new three-room HDB flat that cost around $110,000 a decade ago, can now set buyers back at about $291,000. The recently introduced and widely publicised cooling measures have brought down the number of transactions, but have not significantly impacted the price of housing, which continues to increase.
The PAP is not insensible to this sentiment, with PM Lee Hsien Loong promising to provide affordable housing, and National Development Minister Mah Bow Tan arguing that new HDB flats are both reasonably priced and prioritised for Singaporeans.
It is undeniable that Singapore's housing policies has meant that the country has one of the world's highest percentages of owner-occupiers, and that purchasing a flat direct from HDB is (relative to the Singapore housing market) both affordable and likely to appreciate in value. However, there is genuine and legitimate concern about the shortfall of new HDB flats and the seemingly unstoppable rise of resale flat prices. In particular, the burgeoning Singapore middle classes, who earn too much to qualify for a new HDB or government subsidies, but are not able to afford private housing, feel as though they are falling through the public housing net and this is creating real discontent.
With the General Elections drawing nearer, high public housing prices – and how to deal with them – have been a much debated-upon topic among political parties.
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Opposition
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PAP
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Public housing is too expensive.
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Housing costs are within means of first-time buyers. The
good quality of flats built also contributes to the cost.
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Workers’ Party (WP) proposes to lower the prices of new
flats, explaining that it will have little effect on resale flat values as
new flats are relatively few and cannot be resold immediately.
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Claims WP’s plans to reduce the prices of new flats may
crash the property market. The different market segments are not exclusive
but related; activity in one segment will affect others, especially when half
the current resale flats buyers qualify to purchase new flats.
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WP calls for the reduction of land prices and
re-evaluation of asset enhancement policies in place for the past 20 years.
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Defends that home ownership – and developing them as
assets – is a major factor of the public housing system.
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National Solidarity Party (NSP) insists PRs should have a
longer minimum occupation period to 8 years. Currently, PRs and Singaporeans have to live
in their flats at least 5 years.
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Reminds that PRs are not eligible for grants or loans, and
cannot buy new flats directly from HDB, so Singaporeans already have the
upper hand.
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Related Categories: Daily Property News and Updates, Market Reviews & Market Outlooks
Tags: GE, GE 2011, GE11, General Election 2011, National Solidarity Party, NSP, PAP, People’s Action Party, prices of HDB flats, public housing prices in Singapore, Singapore General Election 2011, Workers’ Party, WP
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