Last week, the Straits Times reported an Indian national and permanent resident in Singapore Mr Farook Ali Akbar who committed suicide together with his son.
Mr Farook came to Singapore to work as a database administrator in 2001 and became a PR two years later. His last drawn salary was $7,300 a month and he stayed in a flat in Bukit Batok. It is not revealed if the flat was bought or rented.
In another instance, an Indonesian PR forked out $653,000 for a four-room HDB flat in Queenstown when he can easily afford a private condominium. His monthly salary was not reported in the papers.
PRs are allowed to purchase resale HDB flats in the open market, but not new flats which are reserved solely for Singapore citizens.
According to a report by real estate agency ERA, about 40 per cent of the buyers in the resale market are PRs though this was disputed by National Development Mah Bow Tan who claimed that the figure is only 5 per cent without quoting any sources.
As PRs are usually mid-level professionals, they can well afford to pay above market rates for resale flats, thereby contributing directly to the escalation of prices.
Since the prices of new flats are pegged to the recent transaction of resale flats over the last three months in the vicinity, the sky-rocketing prices of resale flats will have a “trickle-down” effect on the prices of the new flats too.
With PRs flooding and “spoiling” the resale market, home owners have every reason to jack up their COVs to reap more profits from the sale of their flats.
Now, the question is: should PRs who earn well above $10,000 a month and can easily afford a private condominium or landed property be allowed to purchase a resale flat?
Means testing was introduced in Singapore hospitals not too long ago. Under the new system, patients are allocated classes of wards based on their household income.
For example, a rich patient with a monthly income of more than $8,000 will have to stay in a “B1″ ward and above instead of a “C” class ward reserved for the lower-income group.
According to the Ministry of Health, this helps to ensure that limited public resources are not abused and that the needy will get the help they deserve.
Similarly, HDB flats are considered public “resources” too whether they are new or resale flats.
By right, only citizens should be allowed to purchase public housing as in Malaysia and other countries.
Non-citizens will either have to buy a private apartment or rent a flat. They should not be allowed to compete directly with citizens for public housing.
The rising prices of HDB flats is one key reason why young Singaporeans are postponing marriage and starting a family thereby worsening the declining birth rates.
With a bulk of their salaries being tied up in the housing loans, many will have to contemplate twice to have children of their own.
Making HDB flats more affordable to young couples will encourage them to have more children.
The prices of HDB flats are unlikely to come down by much so long as PRs are permitted to buy and sell them freely without any restrictions.
Means testing should be imposed on PRs buying resale flats and those with a salary above a certain cap are disqualified from doing so.
Singaporeans buying new flats are subjected to similar conditions: a couple with a combined income of more than $5,000 has to buy a four-room or larger flat.
Three-room and smaller flats are only reserved for families from the low income-group.
With due respect to PRs, while they do contribute to the Singapore economy, their futures do not lie in Singapore.
When they finally pack up their bags and return to where they come from, they will stand to make a profit from selling their HDB flats, leading to capital outflow from Singapore.
In the meantime, Singapore citizens who genuinely need a place to stay are unable to get a flat of their choice due to the high prices.
Mr Mah stressed that PRs are allowed to buy resale flats because they also need a place to live:
“PR families are not eligible for housing subsidies that Singaporeans enjoy. They are not allowed to buy a new flat from HDB or enjoy any housing grant. However, PRs need to have a home in Singapore. Therefore, they are allowed to buy properties from the open market, including HDB resale flats.’
PRs can always buy a private property or rent a place to stay. If PRs need a place to live, what about Singaporeans, especially the first-time home buyers?
Between a PR who will leave Singapore in the near future and a citizen who will start a family in Singapore, who will have more stake in the country?
It is myopic of the government to give numerous benefits to PRs in the hope that it will entice them to settle down in Singapore for good.
Many simply take advantage of what the government gives them without additional incentives to take up Singapore citizenship.
As such, a more stringent criteria should be imposed to distinguish PRs who are here merely for economic reasons and those who are keen to become naturalized Singaporeans themselves.
Only those who are willing to hedge their futures on Singapore are allowed to purchase resale flats. One way of assessment is the length of stay in Singapore.
PRs who have been here only for one or two years should be barred from the resale market altogether.
Only those who brought their families here and have stayed for more than 5 years can buy HDB flats and even then, they must be subjected to means testing.
HDB flats have come to be regarded as symbols of Singapore citizenship. A clearer distinction must be made between PRs and citizens.
It is already very generous for us to allow PRs to buy resale flats. They should not add to the housing problem by depriving Singaporeans, especially the younger generation, a chance to own a home of their own.
Mr Farook came to Singapore to work as a database administrator in 2001 and became a PR two years later. His last drawn salary was $7,300 a month and he stayed in a flat in Bukit Batok. It is not revealed if the flat was bought or rented.
In another instance, an Indonesian PR forked out $653,000 for a four-room HDB flat in Queenstown when he can easily afford a private condominium. His monthly salary was not reported in the papers.
PRs are allowed to purchase resale HDB flats in the open market, but not new flats which are reserved solely for Singapore citizens.
According to a report by real estate agency ERA, about 40 per cent of the buyers in the resale market are PRs though this was disputed by National Development Mah Bow Tan who claimed that the figure is only 5 per cent without quoting any sources.
As PRs are usually mid-level professionals, they can well afford to pay above market rates for resale flats, thereby contributing directly to the escalation of prices.
Since the prices of new flats are pegged to the recent transaction of resale flats over the last three months in the vicinity, the sky-rocketing prices of resale flats will have a “trickle-down” effect on the prices of the new flats too.
With PRs flooding and “spoiling” the resale market, home owners have every reason to jack up their COVs to reap more profits from the sale of their flats.
Now, the question is: should PRs who earn well above $10,000 a month and can easily afford a private condominium or landed property be allowed to purchase a resale flat?
Means testing was introduced in Singapore hospitals not too long ago. Under the new system, patients are allocated classes of wards based on their household income.
For example, a rich patient with a monthly income of more than $8,000 will have to stay in a “B1″ ward and above instead of a “C” class ward reserved for the lower-income group.
According to the Ministry of Health, this helps to ensure that limited public resources are not abused and that the needy will get the help they deserve.
Similarly, HDB flats are considered public “resources” too whether they are new or resale flats.
By right, only citizens should be allowed to purchase public housing as in Malaysia and other countries.
Non-citizens will either have to buy a private apartment or rent a flat. They should not be allowed to compete directly with citizens for public housing.
The rising prices of HDB flats is one key reason why young Singaporeans are postponing marriage and starting a family thereby worsening the declining birth rates.
With a bulk of their salaries being tied up in the housing loans, many will have to contemplate twice to have children of their own.
Making HDB flats more affordable to young couples will encourage them to have more children.
The prices of HDB flats are unlikely to come down by much so long as PRs are permitted to buy and sell them freely without any restrictions.
Means testing should be imposed on PRs buying resale flats and those with a salary above a certain cap are disqualified from doing so.
Singaporeans buying new flats are subjected to similar conditions: a couple with a combined income of more than $5,000 has to buy a four-room or larger flat.
Three-room and smaller flats are only reserved for families from the low income-group.
With due respect to PRs, while they do contribute to the Singapore economy, their futures do not lie in Singapore.
When they finally pack up their bags and return to where they come from, they will stand to make a profit from selling their HDB flats, leading to capital outflow from Singapore.
In the meantime, Singapore citizens who genuinely need a place to stay are unable to get a flat of their choice due to the high prices.
Mr Mah stressed that PRs are allowed to buy resale flats because they also need a place to live:
“PR families are not eligible for housing subsidies that Singaporeans enjoy. They are not allowed to buy a new flat from HDB or enjoy any housing grant. However, PRs need to have a home in Singapore. Therefore, they are allowed to buy properties from the open market, including HDB resale flats.’
PRs can always buy a private property or rent a place to stay. If PRs need a place to live, what about Singaporeans, especially the first-time home buyers?
Between a PR who will leave Singapore in the near future and a citizen who will start a family in Singapore, who will have more stake in the country?
It is myopic of the government to give numerous benefits to PRs in the hope that it will entice them to settle down in Singapore for good.
Many simply take advantage of what the government gives them without additional incentives to take up Singapore citizenship.
As such, a more stringent criteria should be imposed to distinguish PRs who are here merely for economic reasons and those who are keen to become naturalized Singaporeans themselves.
Only those who are willing to hedge their futures on Singapore are allowed to purchase resale flats. One way of assessment is the length of stay in Singapore.
PRs who have been here only for one or two years should be barred from the resale market altogether.
Only those who brought their families here and have stayed for more than 5 years can buy HDB flats and even then, they must be subjected to means testing.
HDB flats have come to be regarded as symbols of Singapore citizenship. A clearer distinction must be made between PRs and citizens.
It is already very generous for us to allow PRs to buy resale flats. They should not add to the housing problem by depriving Singaporeans, especially the younger generation, a chance to own a home of their own.
