HDB 101 : What the PAP don't want you to know.

[Sperminator]

I have a question pertaining to HDB ownership...

This is a tough question, and worth some thought.

1. Existing Owners of HDB flats who have bought their flats earlier, before the pricing hike, and influx of FTs;

Would these specific group of people be HAPPY with the idea that their Flat Value be dropped to lower than their purchased value.

In consideration of the future of younger generation who wanted to buy an affordable flat.

2. Current Buyers of HDB flats, who are purchasing the expensive flats at current market rates, during the pricing hike, and influx of FTs.

Would these specific group of people be HAPPY with the idea that their Flat Value dropped to 1/2 of their purchased value.

In consideration of the future of younger generation who wanted to buy an affordable flat.

Definition of affordability; 99% of working adult in SGP, with combined salary of SGD 3,000 before CPF. (On assumption that this is a family whose income do not increase over time for 15 years)

On assumption that the CPF OA could sustain their home loan for 15 years.

10% is for deposit, assuming no COV for maximum affordability.

3 room flats of area around 60 m square to 70 m square ( 1 living room, 2 small rooms, 1 small kitchenette, and 1 small toilet ) --> enough to raise a family of 2 parents and 2 children.

Employers pay about 12% for CPF, and employees around 20% for CPF, assuming OA is 80%. (Disregarding Medisave, and Special Account)

Cash outlay is at maximum = SGD 3,000 X 0.32 X 0.8 = SGD 768.

By reverse calculation, 2.5% HDB loan granted for maximum affordability.

Payment terms 15 years X 12 = 180 (n), INT = 2.5 / 12%, PMT= 768 FV = 0

PV = SGD 115,419

PV is 90% of the entire value of affordable home.

Total Price of today's affordable home = SGD 128,243.

Broadly speaking, today's affordable home should be priced around SGD 130,000.

Proposal;

Build more 60 to 70 m square apartments for young couples to get a head start in life...

Do not emphasize on building 4 room and 5 room flats which are obviously causing financial burdens to families...

My question to the HDB is;

Why have HDB stopped building 3 room flats? Isn't there a demand for this?

Just an idea, and I hope someone could advise me on this.

 

[DrPanacea]

Just bringing this discussion to the top since it is important touches most Singaporeans' lives.

 

[Papsmearer]

My question to the HDB is;

Why have HDB stopped building 3 room flats? Isn't there a demand for this?

Just an idea, and I hope someone could advise me on this.


The answer is money/cost. It costs more to build smaller units and they sell for less money. Or u can look at it and say that for the HDB, since they set the price, they can command the same per sq ft price whether its a 3 or 4 or 5 room flat, so why incur more cost to build a 3 room. If you say for example that there is a total build up area of 500 sq m. per floor on a HDB building. The HDB can decide to build 5 X 5 room flats at about 100 sq m each or they can build 8 X 3 room flat at just over 60 sq m each. The revenues from both option is the same to the HDB as they set the prices, but the cost is different. By building 8 3-room flats, they now have to incur additional cost for building 3 extra kitchens, 3 extra bathrooms, etc.

 

[Sperminator]

Dear Papsmearer,

Thank you for pointing out this point about Cost versus Benefit Analysis.

In my own humble opinion, isn't this the job of the government, or in other words, HDB decision to ensure that there are ENOUGH 3 room flat being built.

Considering the fact that not everyone in Singapore is wealthy enough to afford 4 room or 5 room. HDB only, is enough to keep Singaporeans in debts forever.

Then, what I can observe from this is that, HDB is becoming more profit centered, rather than Social Capital Centred.

Even in Countries in China DO BUILD lower cost housing for the people.

People can argue about speculations this and that, however, by using policy to sign a bond for these people who purchased the low cost housing NOT to sell for a period of 10 years?

However, if they could afford a bigger HDB apartment, they could only sell COST to COST (with inflation considered), to the qualifying couple.

And of course, these special housing cannot be rented for rental incomes.

Making these special category of housing with no market value, capital appreciation, but having value in the area of Social Capital and Social Harmony.

If everyone in Singapore is just making end's meet, and spend what they earn, they will not have the possibility of financial freedom, thereby depending for jobs, for jobs which are getting scarce, thanks to the highly competitive and hard working FTs.

I am just a layman in Singapore, and isn't the objective of the Government is to keep social balance, harmony and increase the happiness of the people?

Isn't what the Government of Singapore is voted for?

When we observe a micro-economics within a family, the happiness level is certainly dependent on the total amount of disposable income the family have left, after Food, Utilities, Basic Necessities, Education, Basic Entertainment (Television, DVDs etc...).

What is left could be used for savings for Children's education, touring to gain an expansive insight of the world, special family outings...

With the BIG BROTHER helping, there certainly will be more people working hard, and happy, because they all know that they will not be in debts perpetually.

The Fear of Debts in itself is causing psychological pains in many, and this by itself will curb innovation and entrepunearism.

As what Dale Carnegie says, money in the bank gives confidence in a person.

Without confidence in a person's life, where would they have the thinking room for innovation and setting up businesses?

It becomes an endless cycle, whereby the parents will make ends meet, and some blaming on the children, and punishing the children for nothing...

And the children grow up... aimless.

To have a complete family, is the social capital of Singapore, and with Happy Parents, you CAN raise Happy Children, and it's the Happy Children of Singapore that will become future leaders, innovation leaders, industry leaders... not the elites... Elites live too high up on the Ivory Tower, and have not been able to feel the reality of life.

Perhaps the MPs of Singapore should pay more visitations and do more interview, in depth, and truly understand the hearts of Singaporean, rather than thinking out of policies from thin air, and looking only at financial statements.

Yes, a profiting nation is important, however, without the Social Capital to support this, it will only be temporary success...

Care to add more? Let's have an intellectual discussion on this.

 

[eatshitndie]

Lai CF says the architect of this system is Goh Keng Swee.


http://www.findsingapore.net/forum/viewtopic.php?p=112892&sid=76650712922d88117c2c3538ed075291
During the Booming 80s, all Singaporeans were clamoring to upgrade from a 700 sq. ft. 3-room to a 1,200 sq ft. 5-rooom.

To cater for the middle-class in the late-70s, HUDC was formed and 1,700 sq. ft. apartments at MArine PArade, Lake VIew, Braddell VIew, etc were sold at S$85,000.00.

And HDB introduced an intermediate executive apartments (income ceiling - S$10,000 pm) at about 1,500 sq. ft.

No aircond edges, no Civil Defence shelter, "pure" apartment space.

And in come DPM Goh CHok Tong and DHanabalan (MND Minister).

This Terrible Twin decided that HDB "car-parks' were under-priced and HDB dwellers must pay "the actual value of land".

....

perhaps, this is one of the best and most insightful dissertations on the housing situation in sg. good job!

 

[Papsmearer]

when you click on 7 did it go back to 6?

is there something secret in 7 cannot be accessed?

Me too, it was eatshitndie's post that was on page 7 and not accessable.

 

[Papsmearer]

Dear Papsmearer,

Thank you for pointing out this point about Cost versus Benefit Analysis.

In my own humble opinion, isn't this the job of the government, or in other words, HDB decision to ensure that there are ENOUGH 3 room flat being built.

Considering the fact that not everyone in Singapore is wealthy enough to afford 4 room or 5 room. HDB only, is enough to keep Singaporeans in debts forever.

Then, what I can observe from this is that, HDB is becoming more profit centered, rather than Social Capital Centred.

Even in Countries in China DO BUILD lower cost housing for the people.

Affordable housing started out as the mandate for HDB. Along the way, the PAP decided to use HDB as a profit making enterprise. HDB today makes at least $150K profit on a 4 room flat that they sell. Many countries in the world make affordable housing a central concept. In S'pore they make unaffrodable housing and thru the useless media, try and tell everyone that it is affordable. In my opinion, u have arrived at your conclusion 20 years late. The HDB no longer builds housing for the people, but rather for profit.

People can argue about speculations this and that, however, by using policy to sign a bond for these people who purchased the low cost housing NOT to sell for a period of 10 years?

However, if they could afford a bigger HDB apartment, they could only sell COST to COST (with inflation considered), to the qualifying couple.

And of course, these special housing cannot be rented for rental incomes.

Making these special category of housing with no market value, capital appreciation, but having value in the area of Social Capital and Social Harmony.

If everyone in Singapore is just making end's meet, and spend what they earn, they will not have the possibility of financial freedom, thereby depending for jobs, for jobs which are getting scarce, thanks to the highly competitive and hard working FTs.

There are many devices to ensure housing is affordable. But its almost impossible to turn back the clock now. It will be political suicide and riot onthe streets if the PAP does this. Lets say for example, the HDB says that form today on wards, they will sell flats at $100K or less. This is good news, right? Yes and no. People who have been paying $300K-$400K for their flats will now be pissed off that new flats cost under $100K. Also, it will depressed the market as no one will buy a resal when a new one can be bought for $100K or less. The banking system will also be in chaos as the value of the mortgage will be higher than the value of the flat when prices plummet. by the way, in Malaysia, non-bumis pay ahigher pricethan bumis for properties, its their law there. We could have the same 2 price system for native born sinkies and FTs. But that would depress prices abit, so not the HDB's cup of tea.

I am just a layman in Singapore, and isn't the objective of the Government is to keep social balance, harmony and increase the happiness of the people?

Isn't what the Government of Singapore is voted for?

When we observe a micro-economics within a family, the happiness level is certainly dependent on the total amount of disposable income the family have left, after Food, Utilities, Basic Necessities, Education, Basic Entertainment (Television, DVDs etc...).

What is left could be used for savings for Children's education, touring to gain an expansive insight of the world, special family outings...

With the BIG BROTHER helping, there certainly will be more people working hard, and happy, because they all know that they will not be in debts perpetually.

The Fear of Debts in itself is causing psychological pains in many, and this by itself will curb innovation and entrepunearism.

As what Dale Carnegie says, money in the bank gives confidence in a person.

Without confidence in a person's life, where would they have the thinking room for innovation and setting up businesses?

It becomes an endless cycle, whereby the parents will make ends meet, and some blaming on the children, and punishing the children for nothing...

And the children grow up... aimless.

To have a complete family, is the social capital of Singapore, and with Happy Parents, you CAN raise Happy Children, and it's the Happy Children of Singapore that will become future leaders, innovation leaders, industry leaders... not the elites... Elites live too high up on the Ivory Tower, and have not been able to feel the reality of life.

Perhaps the MPs of Singapore should pay more visitations and do more interview, in depth, and truly understand the hearts of Singaporean, rather than thinking out of policies from thin air, and looking only at financial statements.

Yes, a profiting nation is important, however, without the Social Capital to support this, it will only be temporary success...

Care to add more? Let's have an intellectual discussion on this.

have you been living in s"pore at all? SInce when has the PAP conducted any alturistic policy, or thought about its people? They are morally, ethically, and intellectually bankrupt.

 

[Zombie]

have you been living in s"pore at all? SInce when has the PAP conducted any alturistic policy, or thought about its people? They are morally, ethically, and intellectually bankrupt.

no offense... i am starting to think that you are becoming like QXP...

 

[Papsmearer]

no offense... i am starting to think that you are becoming like QXP...

Why? QXP is not in sinkieland? Is that a good or bad thing?

 

[Papsmearer]

I remember in the early 1980s, my parents paying $125K for a 2 story maisonette at Bedok reservoir (in those days under HUDC, and not HDB, if I recall). Our household income was about $4000. Nothing spectacular. But a 2 story maisonette in those days was a lot of space. It fitted all of us comfortably. On top of that, my parents could finance it without dipping into their CPF monthly. Even if their income was $3000 we could have still lived there comfortably. Life was not luxurious, but at the least, they are not facing $2000 + monthly mortgage payments. And this was the higher end, flats could be purchased for a lot less in those days. This is what the HDB/PAP have screwed up. This $125K for a masionette represented a small markup for the HUDC, today, they are marking up even cheap 3 and 4 rooms flats by $150K or more. If the HDB and PAP were not greedy, they would not need to import million plus FTs. Why? If you paid only $50K for your flat, than your mortgage payment every month is only a few hundred dollars. U and your spouse can accept a lower salary job, say $800-$1000 each and still make ends meet. We would still be a low cost country, but with a decent lifestyle because the cost of living is also low. MNCs will not be abandoning this country because of high wages and high production costs. We could afford to pay for our housing costs with after tax take home pay, instead of dipping into what the CPF is really meant for, our retirement. Now the PAP is enticing MNCs to stay and come back by massive importation of FTs to lower their cost of doing business. All the time, the original model was working. This is the legacy of the PAP greed and stupidity. People need to understand this concept and the extend of their con.

 

[Papsmearer]

Bump, might be appropriate to review this thread again, given all the new threads on this topic.

 

[borom]

....HDB residents'.....have a season parking ticket, but there is not a carpark space in sight when you return home late at night....... 'Why should I pay? I have been buying my season parking ticket monthly, but I just can't find a space.......

http://www.straitstimes.com/BreakingNews/Singapore/Story/STIStory_543443.html

Does'nt this tantamount to cheating?
Selling something that you do not have-is it criminal misrepresentation ?

When you sell a season ticket for a carpark, the seller must ensure there is a lot available for the buyer. It's no different from selling cinema,concerts, airplane or other tickets. I have never experienced this in other countries before.Anyone can share their overseas experience.

The MP for Bishan -Toa Payoh even excused the HDB by saying "Sometimes ...non resident taking up red spaces...its a question of enforcement but officers can't possibly go down all the time ". (ST June21 B1)
She was elected to represent the residents or HDB ?
Is this what we expect from the highest paid ministers in the world ?

Does those foreigners who paid record prices for their HDB resale know that they may have no place to park their car ?.

 

[Papsmearer]

Does'nt this tantamount to cheating?
Selling something that you do not have-is it criminal misrepresentation ?

When you sell a season ticket for a carpark, the seller must ensure there is a lot available for the buyer. It's no different from selling cinema,concerts, airplane or other tickets. I have never experienced this in other countries before.Anyone can share their overseas experience.

The MP for Bishan -Toa Payoh even excused the HDB by saying "Sometimes ...non resident taking up red spaces...its a question of enforcement but officers can't possibly go down all the time ". (ST June21 B1)
She was elected to represent the residents or HDB ?
Is this what we expect from the highest paid ministers in the world ?

Does those foreigners who paid record prices for their HDB resale know that they may have no place to park their car ?.

Its definitely cheating. U cannot sell something that u do not have. If the HDB does not have this parking space available, they cannot sell it. But as mentioned before in this thread, the HDB also sells 99 year leases. This is also cheating. DO u seriously thing that given the quality and design, and workmanship of the HDB flats, they will last 99 years? The HDB has no intention of honouring this 99 year lease. Long before the lease is up, they will move you out to another estate while they tear down ur old one. Forget about asking MPs, they are next to useless. If an MP read this thread, they will be as surprised as most people.

 

[Papsmearer]

Bumping up this thread for Jubilee and others who are revisiting this subject.

 

[eErotica69]

Any comments on leasehold private properties?

 

[Papsmearer]

Any comments on leasehold private properties?

To answer your question, In SIngapore, the following is listed from most desirable to least desirable.
1) Landed freehold property
2) Freehold private condo properties
3) leasehold private properties (got landed and condos, but really no diff)
4) HDB flat

The main difference is that for leasehold private properties, your chances of seeing the end of the 99 years lease is far better than seeing the end of your 99 year HDB lease. In other words, ur family can continue in theory to live in the same private leasehold property for 2 generations.

For HDB flats, they are designed to get you out by year number 30-40. They are not interested in honouring the 99 year lease u signed with them, and also, their flats are not designed to last 99 years anyway.

 

[gz0707]

Papsmearer, a couple of postings that I think will give some insight into the issues that those of marriage and giving age are facing. It is no surprise that they will choose not to get married and have kids as they cannot afford it.

from Maomao Sihui :
One of the key things to consider in 'making babies' and starting a family is having a roof over ur head. But if housing is that inaccessible and unaffordable... Hmmm. Is not say we don't want, is CANNOT. Got married five years ago and been waiting for a flat since then. Keys ready for collection in a month, but guess what. Am already contemplating divorce plans due to assorted problems which are not convenient for discussion here, but which are all indirectly related to lack of housing. Its a cruel and real situation.

from Rachelle Naka :
Please give us Singaporeans subsidies for housing? We need a roof over our heads before we can make babies. But by the time we earn enough money to make a down payment for a house, we no longer have the energy or youth to want to have babies.

If you want to make sure people don't abuse this privilege, you can always make us sign an agreement of some sort to ensure we make babies~?

Right now, housing price is impractically expensive. If it can be made affordable for us, it'll be one less burden. As a woman, time is a great factor when it comes to pregnancy. I won't wanna have a baby by the time I reach my 30s since the optimal age to get pregnant is in the 20s. But, as a uni grad, I graduated with almost nothing in my bank (came from a poor family) and I'm already in my mid twenties. How many more years do I need then, to finally be able to earn and save enough for a house? In fact, it's not even just house I've to save up for if I want to form a family. Everything is so expensive in Singapore now. By the time I save enough for the downpayment (4 - 5 years), I'd be in my 30s already. And during this period of saving and scrimping, my life will be very mediocre. By the time I have a baby, the vicious cycle repeats itself to commit to the baby, caring for it, schooling it and etc. At the end of the day, I'll look back and realise my whole life have been wasted just because I started saving up to get a house...

So, in the least, make housing affordable for Singaporeans who have intention of having babies.

 

[Papsmearer]

Papsmearer, a couple of postings that I think will give some insight into the issues that those of marriage and giving age are facing. It is no surprise that they will choose not to get married and have kids as they cannot afford it.

from Maomao Sihui :
One of the key things to consider in 'making babies' and starting a family is having a roof over ur head. But if housing is that inaccessible and unaffordable... Hmmm. Is not say we don't want, is CANNOT. Got married five years ago and been waiting for a flat since then. Keys ready for collection in a month, but guess what. Am already contemplating divorce plans due to assorted problems which are not convenient for discussion here, but which are all indirectly related to lack of housing. Its a cruel and real situation.

from Rachelle Naka :
Please give us Singaporeans subsidies for housing? We need a roof over our heads before we can make babies. But by the time we earn enough money to make a down payment for a house, we no longer have the energy or youth to want to have babies.

If you want to make sure people don't abuse this privilege, you can always make us sign an agreement of some sort to ensure we make babies~?

Right now, housing price is impractically expensive. If it can be made affordable for us, it'll be one less burden. As a woman, time is a great factor when it comes to pregnancy. I won't wanna have a baby by the time I reach my 30s since the optimal age to get pregnant is in the 20s. But, as a uni grad, I graduated with almost nothing in my bank (came from a poor family) and I'm already in my mid twenties. How many more years do I need then, to finally be able to earn and save enough for a house? In fact, it's not even just house I've to save up for if I want to form a family. Everything is so expensive in Singapore now. By the time I save enough for the downpayment (4 - 5 years), I'd be in my 30s already. And during this period of saving and scrimping, my life will be very mediocre. By the time I have a baby, the vicious cycle repeats itself to commit to the baby, caring for it, schooling it and etc. At the end of the day, I'll look back and realise my whole life have been wasted just because I started saving up to get a house...

So, in the least, make housing affordable for Singaporeans who have intention of having babies.

Regrettably, these people u quoted above do not know how the system works in singapore.

Firstly, if the HDB wanted to, they can sell flats at cost and the price would range from $80K to $150K for the bigger units. Affordable, right? Yes, but it will mean that the HDB cannot make the profit that they would other wise have made charging $300-$500k for the same flats.

Secondly, the PAP elites and their cronies collectively are the largest property owners in singapore. they don't own HDB flats but they own large number of freehold and leasehold private condos and such. A drastic decline in any HDB flat price will have a ripple effect, resulting in sharp declines to the private property market. On the other hand, a HDB price increase results in the opposite , and it lets them sell their private properties for more. Hence the MIW are not interested in seeing billions $ wiped off their property portfolio by cheap HDB flats.

 

[Boliao]

This thread should be made sticky.

 

[gz0707]

Yes I am aware of that. Most people do not understand how the system work or how their "profits" do not translate to actual wealth. Even so, realistically, getting married requires some form of property, by purchase or lease, so they have no choice but to join the system. Not sure if this has been mentioned before, besides the Nassim Jade incident, HJ and her man have also purchased 2 penthouses through a joint co. This area is very close to KH's previous apt near Orchard area. So yes, they will be affected should property prices go down too. Vested interests, no doubt.