Leong Sze Hian, what is your problem?
Leong Sze Hian, what is your problem? I refer to the article 'HDB rents to be phased in over two tenancy renewals' (ST, Nov 13). It states that 'existing tenants will be given three months' notice of their new rent before their current tenancy is up'. According to HDB's press release 'More help for those who need rental flats', from 1st March 2007, one-room tenants who rented HDB flats before 1st October 2003, with household income from $801 to $1,500 will pay 30 per cent of market rent, instead of the current 10 per cent, at the second renewal. Tenancy renewals are on a two-year term tenancy. This is a three-fold increase, from the current $26 - $33 to about $78 - $99. For two-room tenants who started renting after 1st October 2003, with household income from $1,501 to $2,000, their rental will increase from the current 30 per cent of market rent to 50 per cent, from the first renewal. This is an increase of 67 per cent, from $123-$165 to $205- $276. From 13th November 2006, new $800 and below household tenants who have previously sold one subsidised flat in the open market (i.e. second-time households), will be charged 30 per cent of market rent, instead of 10 per cent, an increase of 200 per cent. For $801-$1,500 households, they will pay 30 per cent and 50 per cent of market rent for first-timers and second-timers respectively. Obviously Leong Sze Hian did not read the reasons given by Mah Bow Tan to adjust the rentals for these flats. Two reasons actually. The first is that the tenant of subsidised rental flats must not be allowed to abuse the system. And when their salary increases, they should pay more. Secondly, by making them to pay more, it is for their own good. This is a way to nudge them into becoming flat owners instead if renting flats. Now the problem is that this increase plus the increase in GST will be going to be a big hit to these lower income earners.