I think the Singapore Government may have reached its objective of curbing the rise of the HDB resale prices after seeing it sky rocketing for more than a year now. But in the process, it has affected some groups of people but for others, it is the basically good news or unchanged.
Newly Weds
For those who can qualify for subsidised housing and are punished by HDB's inefficiencies and failure to cater to demand for new housing, they could now opt for a resale flat since prices are expected to moderate.
Those who cannot qualify for subsidised housing find that the bar has been raised a little (from a limit of $8K of household income to $10K). This would delight some and there is still the option of going for a resale unit.
Family with Growing Wealth and Needs
Well, this would be the group that are greatly impacted if you ask me. For those who have owned a HDB flat for a while now may be considering to:
1) Upgrade to a bigger HDB
2) Upgrade to a condo
3) Buy a condo while owning a HDB flat
4) Buy a HDB flat while owning a condo
For 1), the policy helps as prices may stabilise but that would mean a lower selling price for their existing unit.
For 2), they may be disappointed by the HDB prices moderating and a private condo may continue to rise.
For 3), those that meet the MOP will be OK but those not meeting the MOP will need to wait and may not be able to afford the prices if condo prices continues its rise. There may be a potential for them to gravitate towards substitutes; ie. Malaysian and other overseas properties.
For 4), game over.
PRs and Future Citizens
I believe the policy was meant to address some of the issues related to this group as well. In a way, if prices continues its upward climb, there would be considerations on the part of PRs to come this way or setting themselves to be a citizen of Singapore. Already, some quarters have remarked about Singapore being an increasingly expensive place to be. But how would they be impacted?
1) PRs/Future Citizens who are uprooting and have no other properties in their luggage. They may be attracted by the fact that prices for affordable housing (HDB?) is in sight. Almost like the newly weds who are Singaporeans, they should enjoy this.
2) PRs/Future Citizens who have properties.
There could be a substantial number of such people around. But if they have properties strewn all over Asia, Australia, America, then they would not be eyeing a HDB resale flat.
But if they have a small property tucked away in a village near Mumbai, Malacca, Manchuria, then what is the likelihood of the Singapore Government finding out? Near to zero. They may not be able to afford condos in Singapore but could just take the risk and buy a HDB resale flat.
3) Rich PRs/Future Citizens coming to Singapore to invest in more private properties. Enough said, they would not be bothered by this ruling.
