2/11/2010

High demand for HDB flats due to immigrants

The most authoritative political writer of the ST has given her take on the high demand and high prices of HDB flats. Chua Mui Hoong has concluded that it was due to high demand, particularly from the immigrants. She quoted figures to support her conclusion. 25,000 couples marry each year. Over 7,000 couples file for divorce annually and some may need a new home. In 2008, nearly 80,000 granted PRs and 20,000 given citizenships.The number of resale transactions in 2009 was 37,205, a 31% increase over 2008. Were her figures convincing? I think so. And she must have got them from official sources, not from the gossip circles. HDB has replied a few days ago that the cries of demands were misplaced as demands were not high and they have enough supplies to cater for them. Everyone who applies will get a flat in 3 years! And inspite of saying that, HDB is ramming up the building of more flats. I think if the demand is not there, the high building programme will end up with over supply. But then again no. Only those who have registered are considered demands and when there are enough demands then only HDB will build. Somehow HDB is missing something. Chua Mui Hoong should present her statistics to HDB to let them have a better look at the overall picture of population growth. But it may be of no use as the numbers may not be translated into genuine demands if the immigrants did not apply to HDB. So, who is wiser?

14 comments:

Robert Tan said...

Can't say whether the statistics are right or wrong-must admit I didn't verify them. However, no harm giving them the benefit of the doubt at face value.

Only thing is that the conclusion drawn doesn't seem that logical at first glance.

The numbers given seem to refer to individuals.

Can't they share a flat? Seems quite luxurious to have each person to one flat. Would have thought there there should be at least 2 to 3 persons to one flat or more for the bigger flats.

Maybe there's something here that I am missing....

Must make sure statistics are properly interpreted-don't want to end up with over supply sometime down the road.....

Robert Tan said...

By the way, there could also be significant overlap/risk of double counting if we include new PRs and new citizens as direct additions without taking into consideration that a big portion, if not all, the new citizens were probably already previously PRs.

As for the divorced couples, in the past, 2 or more persons to one flat. After divorce, 1 person to 1 flat? Maybe some will go back to stay with their parents, share a rented flat with friends or move to a smaller flat. Of course, the richer ones will have more choices.

Robert Tan said...

Oh - must also not forget also about those who vacated their flats in paradise and went to heaven. Don't forget to deduct these from the demand equation. Maybe someone else can take over their. Tsk! Tsk!


Seems like the maths is getting more and more complicated and over my head. Maybe that's why we need "supertalents."

Robert Tan said...

The above partly illustrates how , in statistics, using different variables, assumptions, the inclusion/omission of different variables, the interpretation of result and the timeframe involved can make a difference.....

Chua Chin Leng aka redbean said...

Hi Robert, statistics is as good as the user wants it to be. Today we hear pp talk about playing and massaging statistics to serve what they want to say. Such statistics are screwed stats.

A honest researchers will compile stats objectively and let the stats tells him the story. The reverse is true today. Want a specific answer or story and then cook the stats to say see, the stats supports the thesis or conclusion.

Robert Tan said...

That's true Redbean - that's why we should be wary of statistics. The more complex they are, the more variables that could be included/omitted/changed, the more careful one needs to be.

It's not always the case of crooked statisticians.

Very often, it is just human error, judgement error etc. When there can be many variables, many judgement issues assumptions involved, a wide range of results can arise.

Sometimes, it can also be carelessness in coming out with the data/formulas.

Very often, you have to be not just good at statistics/formulas etc but must also be very conversant and familiar with the topic studied.

Sometimes, the person who is an expert in the subject matter have limited knowledge of statistics and the person who is expert at statistics have limited knowledge of the subject matter. The 2 must come together, otherwise, can get very "wrong" answers.

Same thing with accounting. Accounting can give very wrong results if accounting rules are applied blindly to all industries without knowing the nature of the industry, especially complex industries. The presented numbers may be "factually" correct in accordance with accounting rules, but the information conveyed can result in very incorrect interpretation. Sometimes, a rule can be appropriate most of the time, and in certain situations can become inappropriate - eg. fair value accounting being applied blindly across the board during the recent crises. At other times, there may be nothing wrong with the rules or data, but the interpretation could be faulty.

I am not saying accounting is useless. Very often, it is useful. I am also not saying statistics is useless, very often, they can also be useful. Just that we need to exercise care - electricity and fire is useful, but we need to exercise care when using them.

Fievel said...

i dunno what the fuss is all about here. What statistics? I am the statistics, you are the statistics, the housing price is the statistics. Hard statistics with nowhere to run, and nowhere to hide.

Did housing price increase by 40% over the past 3 years? Yes. Can I get a flat despite repeatedly applying? No.
To hell with all that fancy discussion.

Chua Chin Leng aka redbean said...

Hi Fievel, welcome to the blog.

Dun worry, your housing needs will be solved in 3 years time. In the meantime try to find a place to hide.

You can expedite it during the next general election if your voice is heard. But that would still not solve your problem but 3 years from then.

Robert Tan said...

The housing cycle, like the stock market and economic cycles, will go up and down.

The last "boom" in HDB prices was around 1996. Same problem, same issues.

The, Asian Economic crises, everything bust.

For those who bought in 1996, maybe prices are now back to around where it was. Adjusted for inflation, maybe barely where it was at its previous peak.

I am not saying things cannot be improved but history is likely to repeat itself. Happens in Singapore, and as far as I know, happens in almost everywhere else. What can be done is to try to minimize the severity of the price swings.

As for waiting for 3 years, this is also not new. During property booms, waiting time and queues extended, whether it be private or HDB. The length of the waiting time can probably be managed better but is unlikely to be eliminated unless we want to have a situation of a "buffer" stock of flats on stand-by at all times. Even then, may still not satisfy everybody because everybody will want or prefer to choose the flats in the more "prime" areas.

I am sure the issues are being addressed now but whether it is to everyone's satisfaction or not, the relevant parties will need to resolve them. We went through these issues before and I believe than we can and will get through them again.

Chua Chin Leng aka redbean said...

A buffer stock is not necessary a bad thing. With good planning, the excess can be kept to a minimum. We have all the data to plan the building programme and cut the waiting time.

Now the people must decide if they want a govt that can build them a flat only in 3 years if they apply. Or would an alternative party want to offer a shorter period maybe with a couple of hundred of buffer stocks or lower than 3 year waiting period.

There are also many problems with the housing policies which the people should vote on.

Chua Chin Leng aka redbean said...

Why would the rich buy 10 properties for their young children that are still growing up or waiting to be born?

The rich do practise buffer stock for their children, the children they care.

If we care for our children, we not only provide buffer stocks for them, we even pay for the buffer stocks.

Anonymous said...

As an old layman who just learnt to surf the Internet to educate myself, as advocated by many a wiseman, it is a joy to have visited this site.

The comments and interactions here are educational and very enlightening to me. How i wish our parliamentarians are of liked calibres of the contributors here !

Sure; politicians need not be philosophical or divine, however, being meticulous and thoughtful like the people here will surely make this country a nation of good people lead by wise leaders.

Tony said...

please do correct me if i am wrong,,, this so called H.D.B flats are mostly built by foreign workers for minimum terrible wage some earning as low as $600 dollars a month? mostly from India, Bangladesh and China. How many Singaporean can survive on $600 dollars a month with about 20 to 30 of you living together in an H.D.B flat without air condition better yet, your spouses are not allowed to reside with you and the only form of sexual satisfaction is Geylang road? same goes for the Filipinos residing here as maids earning peanuts, they are not even allowed to be in a relationship with a Singaporean.

I keep wondering if our country is for real?

Keep fighting for your H.D.B flats and don't think about the flesh and blood building this flats.
After visiting counties such a Australia Canada UK the United States and Japan i cant help but wonder if Singapore is really a developed country.

And NO foreign workers are not taking our Jobs they are just parking up the shit in Singapore

When they eventually end up catching AIDS in Geylang they are usually sent back to their country.

When you see a construction worker building your H.D.B kindly ask him this questions

how much is your salary? were is your wife and kids and how often are they allowed to visit you in Singapore? were do you reside in Singapore and how many of you workers share a room or a flat? and if you have been working for about 20 years in Singapore when will you be issued a permanent resident the answer will be NEVER cause they are usually sent back when they become older and weaker.

Listen carefully.

THE PEOPLE BEING ISSUED A SINGAPORE PERMANENT RESIDENT ARE MOSTLY FOREIGN SPOUSES OF A SINGAPORE CITIZEN only 10% of foreigners are issued a PR based on the years of working in Singapore, and believe me the terms and condition of getting a singapore permanent resident for this foreign spouses is practically the most difficult in the world.

So please explain which foreign workers or permanent resident are taking away jobs and HDB flats meant for Singaporean.

My beloved Singaporean Is it the housemaids? or the construction workers that are both earning bellow $600 month, are they really taking your H.D.B flats and job

Lets face it how many of you can really survive on this terms and condition of living ?

Now ask yourselves this, is Singapore developed? if yes in what way? our infrastructure ? who are the people building it for the lowest wages?

Chua Chin Leng aka redbean said...

Hi anonymous 11:56, welcome to the blog, from one old man to another: ) Actually if we are living to 80 or 90, we are still very young. 20 or 30 years more to go, can start a new career or a new family: )

Let me also welcome Tony to the blog. There are two interesting points that you have raised. One, the plight of the cheap foreign workers. This is nothing new. Our parents and their parents went through the same condition of employment, even worst. The red turban women or samsui women were the last soldiers that went through this kind of life. And they were also paid a miserable pay.

As for foreigners buying up HDB flats, it is not these poor labourers, they used to call them coolies, very cool.

It this the so called foreign talents that are grabbing up the flats and pushing up the demand. Chua Mui Hoong must have the figures.

We could have have enough space and flats for our children if we have not stuffed this place with so many foreign talents. And also if we have built more instead of snuffing out the supply at the same time.