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Thread: Lack of debate on private housing

  1. #1
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    Default Lack of debate on private housing

    http://www.todayonline.com/Business/...rivate-housing

    Lack of debate on private housing

    by Colin Tan

    04:46 AM May 06, 2011


    It is a pity that after several days of heated oratory ahead of Polling Day, there has been little debate, if any, on the private housing market. After all, a condominium is one of the 5C's besides cash, car, credit card and country club membership that many Singaporeans aspire to have.

    Almost all of the discussion on housing has been focused on the public housing sector. This is expected as there is more political mileage to be gained from a vigorous debate on it. While private housing is not exactly a hot button issue, it does not mean that the majority is happy with the current state of affairs, based on the many letters and opinions covered by the media so far.

    Under the present buoyant housing market conditions, many potential upgraders, not just those living in HDB flats but those living in older private estates, have had their housing aspirations put on hold. However, the sentiment here is less extreme. It is one of disappointment and exasperation rather than anger or discontent.

    It is a shame that there is little debate on private housing because in a small place like Singapore of some 712 square kilometres, our property markets cannot be strictly compartmentalised into high-end private, mass market private and public housing and dealt with separately with different policies for each segment.

    As we have seen since 2007, what happens in one sector invariably affects other segments - all the more so when the various segments are open for investment buying and as the proportion of housing sales by investors - as opposed to owner occupiers - increases over time. Establishing stability or reducing price volatility should be sought for all segments. There should not be a separate playground for the rich and famous.

    We cannot look at London, New York or Tokyo to get an idea of what property prices in Singapore would be like in the future. In these cities, when property prices get too high for locals, they relocate to the outskirts. In tiny Singapore, if we were to do this, we would have to cross the borders and find ourselves in a different country.

    Because of this, housing prices here cannot reach the dizzy heights as we have seen for those in London, New York or Tokyo - the affordability of homes to locals will always act as a constraint. If we have policies that allow prices in one segment to rise unchecked, I am very sure they will backfire.

    On Wednesday, it was reported that property stocks fell on fears that a possible raising of the household income ceiling for HDB build-to-order (BTO) flats could cool demand for mass market private properties. The Government had indicated that the S$8,000 income ceiling for families buying a flat from HDB could be raised to S$10,000 after the General Election.

    If this comes to pass, there will definitely be more demand for BTO flats, but will it mean less demand for mass market housing? I doubt so, as most of these potential buyers are already out of the market for private housing as they cannot afford the prices demanded by developers. This is why they are clamouring to get into the public housing market.

    At the moment, if you have been tracking the profile of buyers, most of the buying of mass market projects are by investors - both local and foreign. Given the low interest rate environment, I cannot see a let-up in buying from these investors.

    Of late, the buying and showflat attendances may have been affected by the electioneering but I expect normal business to resume after Polling Day.

    The only threat is more policy measures to cool the market. But what could be more severe than the sellers' stamp duty measures implemented in mid-January? An interest rate hike? Not likely, because the Monetary Authority of Singapore has stated that a blanket rise will have repercussions on other sectors of the economy. Maybe a more creative way of raising the cost of housing loans? We shall see.



    Colin Tan is head, research and consultancy, at Chesterton Suntec International.

  2. #2
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    No point talking about private housing when it's not the majority of the population. People would rather hear about plans for job security and wages. Without those two, aspirations for private housing is irrelevant.

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    No one talking about private jets also.

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    im waiting for citizens to demand for private islands too

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    Quote Originally Posted by Allthepies
    im waiting for citizens to demand for private islands too
    You'll get Pedra Branca!!!

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    The 2nd Colin article I come across that shows it been shallow in substance...
    Dun he knows that pte prty is much smaller & insignificant to the mass...
    Spore's resident population is 80+% housed in public housing...

    Only $M ppl will be hysterically worried of too high or demand or supply...
    Alamak... next time i better siam article from this author

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    Quote Originally Posted by scsc
    The 2nd Colin article I come across that shows it been shallow in substance...
    Dun he knows that pte prty is much smaller & insignificant to the mass...
    Spore's resident population is 80+% housed in public housing...

    Only $M ppl will be hysterically worried of too high or demand or supply...
    Alamak... next time i better siam article from this author
    cant blame him...this colin is just a puppet

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    Quote Originally Posted by scsc
    The 2nd Colin article I come across that shows it been shallow in substance...
    Dun he knows that pte prty is much smaller & insignificant to the mass...
    Spore's resident population is 80+% housed in public housing...

    Only $M ppl will be hysterically worried of too high or demand or supply...
    Alamak... next time i better siam article from this author
    good technique... distract people from the bigger picture lor...
    Anyway, pte ppty usually cost at least 3 to 5 times that of a HDB so even at 20% of housing market is private, it can potentially yield revenue of that equivalent to the remaining 80% so in terms of , its actually about 50% of market...

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    Capital gains tax is the one to watch out for.

  10. #10
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    Seller stamp duty is already more punitive than capital gains tax.

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    Can adjust SSD and up Capital gains tax. So can say very balanced approach. Anti speculative plus nation building.

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    SSD goes to nation building as it is...

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