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A studyconducted by researchers from the National University ofSingapore (NUS) showed that a Singaporean household earning $5,000 in2017 would be able to buy only a three-room flat.$CUT$
Associate Professors Chia Ngee Choonand Albert Tsui made this projection in their study commissioned bythe Ministry of Manpower.
The researchers made the followingcalculations for younger Singaporeans entering the workforce todayand looking to buy an HDB flat in 2017 when they are about 30 yearsold:
- Lower-middle income households at the30th income percentile (combined monthly income of $5,100) would beable to afford a three-room flat.
- Median-income households atthe 50th income percentile (combined monthly income of $7,100) wouldbe able to afford a four-room flat.
- Upper-middle-income households atthe 70th income percentile (combined monthly income of $9,200) wouldbe able to afford a five-room flat.
This shocking finding tells the storyof a Singapore in reverse gear. In the early 1990s a householdearning $5,000 was able to buy a condominium or even a terrace house.By 2017, according to the NUS researchers, households with twice thatincome will only be able to afford a five-room flat.
In addition, these homeowners will take35 years to pay off their HDB loans.
It seems that the longer the PAP rulesthis country, the less Singaporeans are able to afford.
This is why the SDP has drawn up ourhousing plan where we propose that Non-Open Market (NOM) flats besold at cost (without factoring in land cost).
This not only significantly reduces HDBprices, it also enables Singaporeans to pay off their housing loansin half the time. The savings that our plan provides for Singaporeansenables funds to be freed up for use during their retirement as wellas for other investment purposes.
The HDB started off with the objectiveof providing affordable homes for the people. But along the way, itbecame a profit-oriented enterprise and started to think in terms ofhow to maximise its profit. Hence, the ballooning of HDB prices.
This has brought about an economy thatis distorted and malformed with younger Singaporeans finding itharder and harder to afford HDB flats. The NUS study by professorsChia and Tsui confirms this trend.
In addition, many Singaporeans sinktheir savings into property and wait for it to grow. Few stop tothink how such non-productive methods of investment will spur oureconomy and make it competitive.
The PAP Government shows no sign thatit sees the light and that it is willing to change course. Theresponse by the Ministry of National Development to SDP’s invitation todebate the housing problem is indicative of its attitude: the MND says that all thesystem needs is a “fine-tune”.
In the meantime, Singaporeans find thatthe harder and longer they work, the less we can afford. It seemslike a distasteful joke when they PAP championed the slogan “More GoodYears.”
SDP’s housing policy paper, House A Nation: Holistic Policies for Affordable Homes, can be download here: http://yoursdp.org/_ld/0/7_Housing_a_Natio.pdf