No long term solution for ECs

 

I refer to The Straits Times article “Executive condo scheme divides participants”. (10 May)

 

The issue is not just with the EC scheme but others as well.  Since there can be no one-size-fits-all approach to housing 3.2 million residents in 916,000 HDB flats, every scheme will favour one group over another.  The civil service wastes a tremendous amount of time in micromanaging citizens’ expectations, neglecting the more important role of governance.  As a developed nation, it makes little sense for the government to control housing. 

 

The HDB administrative nightmare in housing more than 80 per cent of the population has contributed to a serious shortage of affordable housing for Singaporeans.  80 per cent of Japanese, Americans and Malaysians in public housing would translate into 90 million Japanese, about one quarter of a billion in the US and 25,000,000 across the causeway.  Are we that unique?

 

(I believe it has been worthwhile for politicians to control public housing for 2 simple reasons – Singapore is only 715 square km and there is no threat of natural disaster unlike other countries.) 

 

Back to the EC issue.  Although there are restrictions, ECs become fully privatised after the tenth year and are allowed to be bought by foreigners.  The price then shoots up to below (non-EC) condo prices.  Bear in mind that ECs are also sold at about 20 per cent below the market price of condos and the prices have already been anticipated to narrow with condos after 10 years.  The issue is therefore not only the $30,000 government grant given to buyers but much more than that. The government is indirectly dishing at least $100,000 to an applicant of luxurious public housing (oxymoron). 

 

It is a no brainer that there will be many who oppose scrapping ECs.  Greed is inherent in the nature of people, something which the PAP government has cultivated in the populace and has to be discontinued.  (The current property bull market has many screaming unfairness. In a bear market, it will be condo owners demanding a higher government grant. More National Conversations the solution?)

 

Since the implementation of the EC scheme in 1997, the HDB price index increased from 136 to 205 and slightly more than doubled from 2002.  Is it therefore not justified to also increase the income ceiling of applicants which have only been increased 2 years ago by 20 per cent?  Does the government want to get on with its job of providing REALLY affordable housing or does it want to continually tweak an inherently unstable system?      

 

 

Source: HDB  https://www.hdb.gov.sg/fi10/fi10321p.nsf/w/BuyResaleFlatResaleIndex?OpenDocument#Detail

 

Conclusion

 

The HDB has strayed from its objective of providing affordable public housing to include providing luxurious housing.  It is not the government’s role to assist Singaporeans to eventually purchase private property through schemes such as the EC. Period.

 

Thank you.