Friday, March 22, 2013

Peg flat subsidies to minimum occupation period

Mar 23, 2013
I AGREE with Mr David Goh ("HDB must return to its original aim"; Wednesday) that the Housing Board should increase the minimum occupation period (MOP) before a home owner is allowed to sell his flat.

The problem does not just lie with permanent residents buying our flats, but also Singaporeans who "flip" their properties.

Flat subsidies for citizens can be tiered depending on the MOP the buyer applies for.

For example, a buyer can get a $20,000 one-off subsidy if he opts for a five-year MOP, a $40,000 subsidy for a 10-year MOP, and an $80,000 subsidy for a 20-year MOP.

This will gauge whether someone wants to buy a flat for accommodation or as an investment.

Those who fail to satisfy the agreed MOP will have to sell the flat back to the HDB at the price it was bought.

This measure will not only help to control the number of citizens who are out to make a quick buck, but also make public housing more affordable for those who genuinely need a place to live in.

Owning an HDB flat must always remain a privilege that every Singaporean can enjoy, but not abuse.

Yeo Shuan Chee

[I don't want to bash these people who are just trying to get a place to call home. I understand their frustrations. But they don't seem to understand economics. Or have common sense. In part it is because whatever solution they come up with tend to be biased and short-sighted.

Their proposals tend to be short-sighted because they only want to solve THEIR problem, not the whole problem. Worse of all, THEIR solution doesn't even solve THEIR problem.

Increasing the MOP will mean fewer flats can be sold, so the supply of resale flats will shrink, and guess what? The resale prices will rise. HDB has recently de-linked their BTO flat prices from resale prices, but if they haven't, the BTO prices would also rise!

BUT since BTO prices have been de-linked from resale prices, then what is the issue with MOP and resale? Unless David Goh and Yeo Shuan Chee have both lived in their flats longer than whatever MOP they are proposing (10 years), and are trying to sell their flats at inflated prices, but are unable to inflate the price much higher because of the current levels of supply! If they can stop their neighbours from selling, their flats would be worth more!

And if they AREN'T current and long-time flat owners, they are solving a problem that does not exist (the high resale prices shows that there is insufficient supply, not too much), and which CANNOT help them to buy a BTO (HDB has already de-linked BTO from resale).

Singaporeans continue to prove to me that they are selfish, self-centred, self-absorbed, and can't see further than their noses when it comes to understanding their environment and circumstances. Oblivious - the defining characteristic of a Singaporean.]

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