People Should Be Free To Decide What A Flat Is Worth: Hdb

[trulysingapore 0]

I refer to the letter “People should be free to decide what a flat is worth: HDB” dated 14th Sept 2009.

HDB claims to be responsible for sustaining flat prices over the long term. Looking at resale flat prices from 1990 to the present, sustenance of flat prices hardly needs worrying about as increases in flat prices have far outstripped increases in peoples’ incomes. Conversely, shouldn’t it be HDB’s responsibility instead to ensure that increases in flat prices do not outstrip the people’s capactity to pay for them?

The title of the letter itself suggests a misconception surrounding the myth of “willing buyer, willing seller” so often perpetuated by the HDB. The fact that HDB is claiming to be responsible for sustaining flat prices means that it has the means to influence the overall price level of HDB flats. That is the crux of the issue. While people are free to decide how much to price their flats, their decision cannot deviate significantly from market conditions that are largely controlled by the HDB itself, through such mechanisms as controlling the amount of land that it releases to the public and the number of new flats that it builds. Ask ourselves, how can we sell our flats at a premium when the govt is building one exactly the same right next door to be sold at cost? It is because the govt isn’t building them or isn’t pricing them at cost or is choosing to release the land for private condominimums for example that resellers are able to command the premium that they are getting.

The situation is not unlike the case of a sole importer monopolising the rice trade. If he opens up all his warehouses and distributes the rice to all the shop keepers, there will be plenty of rice for everyone and no one will have to pay a premium for rice. But the moment the importer restricts his supply of rice such that supply barely meets demand, people will start to fight over rice and the shop keepers will now be able to command a high price for rice. That is exactly what is happening to our HDB resale market. By not supplying enough new flats, the HDB creates the conditions for the resale market to heat up.

The HDB claims that the total number of bookings for HDB flats with grants amounts to 13,000 to 15,000 units each year, which far exceeds the 8,000 new flats HDB is building this year. So isn’t this clear evidence that the HDB is not building enough new flats to satisfy demand?

The HDB claims to have enabled 80% of the population to own their own homes. But going by the exhorbitant price people have to pay for house ownership, house ownership becomes a terrible liability rather than a proud asset that the people can be proud of.

[Kalidor 0]

The HDB claims to have enabled 80% of the population to own their own homes. But going by the exhorbitant price people have to pay for house ownership, house ownership becomes a terrible liability rather than a proud asset that the people can be proud of.

I agree with this last paragraph..... i fear for both my wife and my own retirement once we sink our CPF right now and future contributions into my flat

[trulysingapore 0]

I agree with this last paragraph..... i fear for both my wife and my own retirement once we sink our CPF right now and future contributions into my flat

Hey, why don't you read everything. i'm trying to explain something that a lot of people would find hard to believe. so hopefully, more people can mull over the logic and see some light.

[Kalidor 0]

Hey, why don't you read everything. i'm trying to explain something that a lot of people would find hard to believe. so hopefully, more people can mull over the logic and see some light.

OK... I have read eveything that you have posted in all the threads so far, so I'm not just picking the paragraph... what I'm saying here is that this last bit is most telling....

But yes, I generally agree that the government has somehow lost touch with the problems of the common man in the street, be it flat prices or otherwise...... I mean how many of our ministers stay in a flat or take public transport to work...... or draw anywhere near the salary of the avaergae working adult??????

[CJREDDEVIL 0]

OK... I have read eveything that you have posted in all the threads so far, so I'm not just picking the paragraph... what I'm saying here is that this last bit is most telling....

But yes, I generally agree that the government has somehow lost touch with the problems of the common man in the street, be it flat prices or otherwise...... I mean how many of our ministers stay in a flat or take public transport to work...... or draw anywhere near the salary of the avaergae working adult??????

Hi Kalidor,

Well said & well done! Totally shared the same view with you.

It seems to me that our friend " trulysingapore" is not really a true singaporean!.. ... You seems to be siding or an officer representing HDB or even MBT ? Guess what.... ..maybe you are on the wrong forum platform.

Sorry if I have missed represented my opinion.

Cheers!

[trulysingapore 0]

Hi Kalidor,

Well said & well done! Totally shared the same view with you.

It seems to me that our friend " trulysingapore" is not really a true singaporean!.. ... You seems to be siding or an officer representing HDB or even MBT ? Guess what.... ..maybe you are on the wrong forum platform.

Sorry if I have missed represented my opinion.

Cheers!

if you have read as much as kalidor did, you wouldn't have come to this conclusion.

so no need to apologise, just give it a proper read and you'd understand where i m coming from.