Why HDB flats are not affordable at current prices

[temasekreview]

In this 3-part series, Eugene Yeo sets out to debunk the three most pervasive misconceptions of HDB flats: - 1. Singaporeans own the flats, 2. The flats are affordable and 3. Their rising prices will lead to wealth creation]

MYTH #2: HDB flats are affordable.

TRUTH: HDB flats are affordable only to a minority of Singaporeans and is increasingly priced out of the reach of the average worker.

In spite of the relentless rise in HDB prices lately, the government insists that HDB flats remain affordable to the masses.

Recent pronouncements by the Minister of National Development Mah Bow Tan and HDB officers in replies to concerned citizens in the Straits Times Forum have largely sticked to the official stance: that the government will not intervene in the market to bring the prices down.

Minister in the Prime Minister’s Office Lim Hwee Hua maintained that HDB flats are affordable to ordinary Singaporeans as they cost no more than 30% of their monthly pay.

HDB’s deputy director Mr Ignatius Lourdesamy wrote to the Straits Times Forum lately that HDB flats remain affordable to eligible first-time households as they use between 21 to 25 per cent of their monthly income to service their loans on new and resale HDB flats which are well below the international affordability benchmark of 30 per cent.

Though he did not state it explicitly, he is likely to be referring to the average shelter-cost-to-income ratio (STIR) or the proportion of total before-tax household income spent on shelter. The shelter-cost-to-income ratio is calculated for each household individually by dividing its total annual shelter cost by its total annual income. A STIR higher than 30 per cent is conventionally taken as indicating a serious housing affordability.

Read rest of article here:

http://temasekreview.com/?p=12273

 

[angie]

Siapa ini Eugene Yeo?

.

 

[Lee Hsien Tau]

If you cannot afford, you can<br>fuck off the island!​

 

[LonewolfAlfa]

no money dont buy 4/5 room flat.

 

[JinGanKor]

it is affordable, just that it will take longer and longer to clear the loan, maybe next time will stretch the loan to your son and still they say affordable.

and provided there is no retrenchment and paycut, no critical illness to the breadwinner down the road of this 30 years.

 

[Gallego99]

it is affordable, just that it will take longer and longer to clear the loan, maybe next time will stretch the loan to your son and still they say affordable.
...

The interest HDB dwellers will have to pay for the initial years of a 30 year loan period will make HDB and the banks smile from ear to ear. They're farked!

 

[hockbeng]

In this 3-part series, Eugene Yeo sets out to debunk the three most pervasive misconceptions of HDB flats: - 1. Singaporeans own the flats, 2. The flats are affordable and 3. Their rising prices will lead to wealth creation]

MYTH #2: HDB flats are affordable.

TRUTH: HDB flats are affordable only to a minority of Singaporeans and is increasingly priced out of the reach of the average worker.

In spite of the relentless rise in HDB prices lately, the government insists that HDB flats remain affordable to the masses.

Recent pronouncements by the Minister of National Development Mah Bow Tan and HDB officers in replies to concerned citizens in the Straits Times Forum have largely sticked to the official stance: that the government will not intervene in the market to bring the prices down.

Minister in the Prime Minister’s Office Lim Hwee Hua maintained that HDB flats are affordable to ordinary Singaporeans as they cost no more than 30% of their monthly pay.

HDB’s deputy director Mr Ignatius Lourdesamy wrote to the Straits Times Forum lately that HDB flats remain affordable to eligible first-time households as they use between 21 to 25 per cent of their monthly income to service their loans on new and resale HDB flats which are well below the international affordability benchmark of 30 per cent.

Though he did not state it explicitly, he is likely to be referring to the average shelter-cost-to-income ratio (STIR) or the proportion of total before-tax household income spent on shelter. The shelter-cost-to-income ratio is calculated for each household individually by dividing its total annual shelter cost by its total annual income. A STIR higher than 30 per cent is conventionally taken as indicating a serious housing affordability.

Read rest of article here:

http://temasekreview.com/?p=12273

They will never let ppty prices fall and will keep insisting that HDB prices are affordable as HDB resale $$ form the backbone of private ppty prices.

And why they need private ppty prices to remain high?
1. Guess who owns the most private ppty in spore?
2. High price = high stamp fees + more $$$ from new gov land sales
3. High price = higher profits for banks
4. High price = high debt = dont dare vote opposition. Otherwise, when cat is out of the bag, all the cards come tumbling down. Even LKY said so and threatened that if Spore votes opposition into power. ppty prices will fall.

Unfortunately, if you want prices to become more affordable. then we must all do the right thing in 2011. Trouble is that most dont have the courage to do so.

 

[2lanu]

It's idiotic to ask the seller this question izzit? If I am selling you something, I sure say it is affordable lah...

 

[0939]

To measure the affordabilities of buying HDB is your first down payment. How many years of working before you can pay your downpayment with your CPF ( no cash).Take a 4-room for example. How much now you have to pay, by then will your CPF be enough?.
Can anybody know the amount?. For me, I bought my 1st HDB 4-rm with a down payment of $7,500 in 1982, at that time it was worth about $35,000 plus. When I acquired it in 1985. It gone up to $65,500 citing inflations. I have no problem paying the downpayment.