Mission confused or mixed up kids

The pricing of HDB flats to market prices is just a natural and convenient process. When market prices go up, prices of HDB flats must go up. But HDB is also kind enough to price them with a market subsidy so that the buyers still pay less than the market price. Is that not fair? Yes it is fair, and very logical and very reasonable too. What about the immediate and long term consequences of higher property prices? The immediate problem to the new buyers is that their money shrinks every time the market price goes up. The young couple could be saving for their $300k dream flat. And they think they have saved enough only to find that money still not enough because the $300k flat is now $500k. Thanks to the appreciation of property prices and HDB’s pricing policies. And thanks to the great subsidy the HDB is giving them. But money still not enough after several years of savings. It is like chasing an illusion. Ok, buy a smaller dream flat. Don’t buy what you cannot afford. That’s life man! Profit is good. Why shouldn’t HDB make the extra profit when they can? Making profit from who and for what? The person who made this clever decision should be rewarded with a $10m bonus. The decision is so brilliant and the profit so clean and easy. But he shall remember that he has just hung a $200k millstone on the neck of the new buyers. And the affected buyers are not going to think kindly of it. Even donating his millions to charity will not be enough to amend the losses or burdens that the people will have to carry. As a govt body, the mission is to serve the people, not simply making more profit from every opportunity. It is an unnecessary decision that HDB need not make. A smaller increase would be much palatable. Instead, the $200k will be seen as an opportunistic decision by a mixed up organisation that forget its main mission. And it will reflect badly on what govt is all about. When the roles of govt and business got entangled and the bearing lost, this is what the people can expect. When the govt thinks it is doing business and when business thinks it is the govt, everything will be turned upside down.


Anonymous said...

The Government is squeezing Sillyporeans in every possible way to make as much money as possible for someone to loose on investments overseas. The more they loose, the more they will squeeze. More good years. Wait long long lah!

Matilah_Singapura said...

It is about time the hdb was totally disbanded and all the existing titles turned into private property.

The values can then fluctuate with the market and make sense, and at least have some "justice" for those new young couples planning to start homes of their own.

MAS can help by not allowing credit bubbles to appear in the property market by not inflating the currency.

Credit bubbles in the property market artificially inflate the values of real estate, pricing houses and land a lot higher that they are actually worth.

As usual, the main culprit behind the crime: The Government.

The HDB is one of the ways the PAP stays in power. It is always an election issue. The people must decide to force their govt to drop this political gun-at-the-head tactic and start winning elections fairly and squarely (if that is ever possible in politics)

Anonymous said...

Dear redbean;

your call(through this article) should have came in 25 years back. There were ' strong feelings and suspicions' that Public Housing was(is) a State Enterprise raking good profits.

But, then owners then were also so very happy to ride on the System(Housing) to get themselves a tidy profit, did they not?

Matilah suggest doing away with HDB, how to? when Private Properties are beyond the average Singaporeans?

HDB is all the more important now that unemployment and falling wages will plague most for the coming years. It(HDB) has to play a very vital role in providing shelters to those who otherwise will sleep at parks, void decks and public places.

The least to do is to keep HDB to build rental properties to the 'underclasses' under genuine subsidy schemes.

An enterprising Government is also a profit-making one, it is how the citizenry could contribute towards the bottomlines of the country economic progresses that matters to it.



Anonymous said...

when the prices of homes appreciates in tandem with the economy and the standard of living, it becomes a win win for the gov and the people lah.

fact is, most of the 90% homeowners are not lamenting when their most prized asset appreciate or remain steady.

as for new buyers who are complaining, well, a home is how you make of it and they have to learn not to be fuzzy lah. most importantly, no one is deprive of housing even the working poor as long as the gov provide the necessary subsidies to help them.

let say a 3 bdrm rise to $300k.it may seem ridiculous to non home owners but we all know majority home owners won't be stupid to decry their good fortune created by the gov. those who will condemn are probably sore losers opposition or first time home buyers. but with subsidies in place, all is not loss lah. let say if the gov willing to subsidize $200k for you to buy a 3 rm, the first time buyer can literally own one for $100k.

see, affordable what and everyone wins, because wealth have been created, at the end of the day as long as we keep prices STABLE. hehe.

Anonymous said...

sorry.. fussy not fuzzy..lol

redbean said...

ya, give $200k or take $200k?

don't forget that HDB is not your normal commercial developers who have to bid market price land and all kinds of business contraints. here HDB has everything. only decide when and what to build and who to give the contracts to.

patriot would feel sore, and those older generations too, when they remember how their land were taken over by the state and they being compensated for a pittance. now these land are used to build flats and sold at market prices. and nice profits.

Matilah_Singapura said...

anona 339:

"Homeowners": this is false. No one owns their HDB. HDB's are leased from The State.

My proposal is that HDB is completely dismantled and flats turned over to dwellers as pure private property.


No one can say what the price level of privatised hdb's will be, but you can rest assured that the prices will remain fairly constant — depending of course on how much MAS inflated the money supply.

HDB prices in certain areas (say, Jurong) could actually fall. But then again, that might be "bad" for present owners, but at least that gives new entrants into the market a sporting chance of owning their home.

The main point I'm making is that the govt should be booted out of the housing market. They are using HDB as a political lever, and for years it has been in the state's favour. Into the state's hdb's they put public schools, public transport, public this that and the other...until eventually almost everyone living there is "bought off" by the political elites, which guarantees them a victory in the next election. (with the exception of a few wards).

When you take away power from the govt, they hurt you less.

From the beginning HDB has been a corruption:

1. The govt acquired the land from people by legalised theft

2. Years of corrupt practices by ministers

3. Years of cosy relationships with contractors and suppliers

4. On-going revenue from no-choice legal services provided by a certain well-known law firm.

What the fuck? How long do S'porean Sheeple want this madness and sheer BIG FAT LIE to continue?

Anonymous said...

patriot is not the only one hurt by resettlements, I like You to know that many others felt and feel the same.

For me and my fellow villagers, we knew they did not have to use our village for the water recycling plant because there were many unoccupied/unused lands in the 70s.

And Matilah Singapura had explained in his comments in this thread why Singaporeans are put into the pigeon holes. Singaporeans are trapped and indebted themselves with absolutely no recourse.

Yes, I have to admit, like many others, I am unable to extricate myself from the misfortune of been born here. How I envy Matilah Singapura, but not jealous okay!


Anonymous said...

The script is already written long ago. The govt controls the land bank and therefore controls the supply of land and ultimately the prices of HDB flats. The people keep on working harder to accumulate more CPF to transfer to the HDB and everybody lives happily ever after. That is, if the property market does not end up like the US.

Matilah_Singapura said...


Although I could be flattered by your comment, I'm not. If you only knew how hard is has been as an immigrant, you'd probably not be envious. There is little doubt that life would have been more comfortable had I stayed in S'pore and not taken the risk of immigrating -- however that was many years ago. But those days are over.

I am no longer an immigrant but a full-fledged member of a great society (with all it's faults). I would say the risk, the "sacrifice" (of comforts and conveniences in S'pore) and the hard-times was worth it. You always have to pay a value to get a bigger value -- that's life.


> That is, if the property market does not end up like the US. <

Although that could happen, it is unlikely. MAS (thankfully) doesn't have the power of the US Fed, and despite it's recent foibles Ah Goh and his MAS are quite cautious about inflating the money supply, about lax lending (if you earn below a certain amount you are basically denied credit -- e.g. credit card. Car loans are capped, etc etc) and about "fighting" the free market.

Be thankful for small mercies: the Sg.gov and especially MM Lee knows how important it is to keep a stable, "hard" currency which retains its purchasing power. If you compare the SGD to the USD, the Ringgit and the rupiah, you'll know what I mean.

redbean said...

while the market forces will punish the wrong, there must be forces to nip the wrongs in the bud before they get too far wrong. the financial industry is experience the wrath of market forces for a wrong that has gone on for too long.

paradise will reap its consequences if the wrongs are not corrected now.

Matilah_Singapura said...

Family. Family cohesion will prevent most "wrongs" in society.

However, throughout history, the ever-growing state has nearly destroyed family cohesion.

Anonymous said...

True, the state has replaced the family in many 'free' Western societies.

And Aussie rocks!