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5/31/2011

The crime of earning $10k

The arbitrary $10k ceiling for the combined income of young couples is looking like a crime. It has been elevated to a sacred status that it is almost untouchable, like a commandment carved in stone. Young couples who have a combined income of $10k are disqualified from public housing. They are deemed too well paid, and able to pay more for private properties. They should go and buy a smaller but more expensive private property, or go for the big owns and take a bigger loan to service. The value of thrift and savings and financial prudence is thrown to the wind. If after taking a big loan and something untoward happens to their income that is their problem. And the private developers and speculators are all rubbing their hands eagerly waiting for these young couples to commit, after being forced out by the system. They have no choice but to take the plunge. What kind of philosophy is this? Forcing young people to go into big debt because they earn a little more than others? What is $10k anyway? Any decently qualified young couple that failed to get hitch within 3 to 5 years will see their income exceeding this arbitrary ceiling pronounced by god. Is it wise or decent to force young couples, just starting to work and with a full list of commitments ahead of them, to plunge in with a half a million or one million dollar loan? I think it is a crazy idea and very irresponsible. The crap about some of these young couples adding to the queue is another hogwash. Just like the spurious building acitivity today, it is all about building to meet the needs and demands of the people. The crime is for not building, not the young people wanting to join the queue. And not many would join the queue as those with lesser commitments would risk taking a bigger loan for private properties. It is no crime or shame to want to buy a cheaper home and save for tomorrow. The principle of thrift and prudence is age old wisdom. Punishing the young people for your own inept, poor planning and farcical beliefs is shameful. No one must be forced to eat sharksfins and force to pay for it. The $10k ceiling is another mean testing that is wicked to the core, like its parallel in healthcare. It only serves to fatten the pockets of speculators and developers at the expense of the young people. Just go and build the flats that the people need, and stop the silly reasoning. Every able young man must be given a chance to buy his first public housing. This is only equitable, just and fair. They also do their bid to serve the country like everyone else.

7 comments:

Anonymous said...

The government must address the current HDB mess from its poor policies of past 10 years with a heart. Squeeze in supply, high engineered HDB pricing, pro-asset & foreigners policies and outright folly are some of the causes. Ex-Minister Mah was clearly out of touch with the principle of being equitable and realities faced by the masses especially the young. He had set high asset prices, and thereby placed many late buyers in past years in a high risk position with much unnecessary debts because of "greed" of higher asset prices and revenue.

Though I own a few properties, I support significant lowering of HDB prices for young 1st time buyers, cheaper housing for single parents taking care of children and "oldies" singles. We have to be fair to them.

Chua Chin Leng aka redbean said...

Hi anon, it is very exceptional for someone who owns several properties to acknowledge the people's need for a home. The most important task of the govt is to provide every citizen a chance to buy a first home at a reasonable price. After that, many things and factors will come into play and no one can predict what will be the end result.

Though the private and public properties are interlink, both have a life of their own. One is more a basic need and another a luxury plus an investment, speculative element in it.

Take care of the basic needs first and the rest are of lesser issues, more bearable. Those who can afford it, go invest, speculate in private properties. But don't force the young to be in the ring. It is a different world and for different reasons.

Anonymous said...

Author, you have taken the thoughts right out of my mind.

Lets break down this one by one.

The 10k ceiling is a 2k increment from 8k previously and this took 17 years to put in place! Just imagine the amount of inflation that had taken place in this 17 years, it is definitely more than the 25% increase (think of your S$2 wanton mee which cost a minimum of S$3 now). This 10k is firstly, too low and does not address the quandary that young couples have now which is should you quickly apply for a HDB (after 1 year of dating after graduation) or be pushed into the private market and heavily into debt.

Secondly, you have the SAF talking about the importance of citizen soldiers having a stake in the country. How about giving some of your budget to your young soldiers and allow them to buy HDBs irregardless of their total income? This will segregate the real citizens who wasted 2 years of their youth against the new citizens who claim patriotism by doing his job(erm he is a doctor right? Of course he saves lives).

I hope there can be some communication between the MND and MOD on this. You want a strong defence force, give your soldiers something to defend other than the properties held by foreign millionaires!

Pity the daft Singaporeans.

Anonymous said...

They are heavily invested in private properties and need to force these helpless young people to support their investments. Only think of their own profits.

The young people, they die their problems. The stupid $10k ceiling is to benefit who? Where is the moral and conscience?

Anonymous said...

Quite clearly the PAP govt has lost its way for at least a couple of decades. When Singapore the Republic becomes Singapore Inc. the end is no longer to build a nation. The slants becomes how to make profit and more profit at every turn for its own sake.

In reality, not everything in a country can be a profit centre. Typically the PAP govt treats such consuming rather than profit making areas by minimizing its involvement (eg. education of Singaporeans with disability left to charity) or virtually ignoring that they even exist (the poor, the homeless, broken families, the aged sick etc again leaving it to people to their own devices and charity).

One can go on and on.
Basically, the PAP govt has failed in its responsibility to make a country of its people by its deviation from nation building to concrete building.

Chua Chin Leng aka redbean said...

Oh, many people are still yaking that removing the $10k ceiling will increase demand for public housing, just like having KPIs to measure minister performance.

Why don't they think a little and ask what is the real cause of the problme? If supply is more than demand, there is no fear of demand.

Further, many who can afford it with their $10k or more income will surely go to the private sector. Those that are still looking at HDB are those with other family commitments or just being prudent and not wanting to over commit themselves and tie a piece of rock on their necks.

Anonymous said...

$10K a month combined is not going to help a couple get out of debt in today's property market - whether its public or private. And goodness forbid they either a) have kids or b) opt for a resale flat at some point for whatever reason, that's where these couples will discover just how little $10K a month can be, as princely a sum as it sounds on paper. Take that picture then apply it to lower-income families... I sometimes wonder its a miracle how people get by at all. "Your home is your asset" - hahaha... nice try. Notice how they don't trot that out.