Review the policy on home ownership

The Singapore govt encouraged home ownership during the past decades. It is time to review this policy.

Home ownership was promoted with the following policy goals:

a) Encourage citizens to have a stake in Singapore
b) Give the citizens a chance to own an appreciating asset
c) It make social more stable when the citizens do not have to worry about being chased out of a rented home.

While the policy has produced real benefits in the past, it has now become questionable. Here are the reasons:

a) The high cost of property has now become a burden for the citizens
b) Home ownership forces the citizen to the tied to a specific property and discourages the owner to move to a new home closer to the place of work.
c) The heavy cost of the down payment delays the marriage of young people by a few years, while they accumulate sufficient savings to meet the down payment.
d) The appreciating value of the homes allowed the citizens to cash out their profits and migrate to countries with lower cost of living
e) The home owners now realize that the properties will decrease in values as the lease becomes shorter. This is known as lease decay. It is no longer an appreciating asset.

It is now important for the govt to review its policy on home ownership to take into account the negative effects, which has been observed in recent decades.

What is the solution?

I propose the following:

a) Give an option for young people to rent HDB flats from the govt and enjoy the same subsidy given to home ownership.
b) If a young person rent the flat, he can be exempted from contributing to the CPF, so that the money can be used to pay rental.

This approach will reduce the financial burden for young people and allow them to get married at a younger age. It also gives them the flexibility to change jobs and to move to a new home that is closer to their place of work.

 

Tan Kin Lian

 

 

 

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22 Responses to “Review the policy on home ownership”

  • opposition dude:

    Aiyoh, Tan Kin Lian makes the situation worse instead of better with his 2 suggestions.

    If the youngsters rent then it’s a burden liao because they have to pay rent. If you are going to pay rent then how are you going to save for marriage ah? You want to get married you need as much as you have saved in order to do so plus whatever is in your CPF to pay off your BTO.

    And if the youngster rents he can be exempted from paying CPF says Tan Kin Lian. Then the CPF is kosong liao. How to save for retirement like that?

    The solution as many have said is to lower the cost of flats. If a couple has a combined CPF which is perhaps 70% of the BTO they won’t have to spend 25 years to pay it off. We all want to pay off our flats as soon as we can so that it’s a burden off our shoulders after all. If a couple can pay off their first home within say 7 years then it would help them greatly.

    Typical Tan Kin Lian idea, just mention the idea and the positives without even thinking of the negatives. I’m still laughing from his other brainless suggestion on streamlining the bus network without even considering that there are people who do take the option of having a direct bus to their destination.

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  • Evil, Greedy And Corrupt:

    Your same proposal on rent can be applied directly to home ownership instead.

    You are essentially proposing something to avoid the problem of overcharging by the government, do you realize that?

    So overcharging by government is the issue.

    The people are made to pay for something that they do not own, like the highly inflated price with the land cost inclusion.

    The key difference is that with “homeownership”, as you have pointed out, gives stability, especially to a family.
    So rather than avoiding or abandoning something that is essentially better policy to go after one that created more instability does not make more sense.
    The government should just be less greedy and behave honorably, a greed that has grown over the years with that self entitled mindset, to honestly return the overcharging in HDB.

    Moreover, to ask the government to abandon a lucrative policy of milking a huge sum to go after piecemeal rental money will not go well with their greedy DNA.
    This is pure common sense.

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  • tan kin lian is so cock:

    the problem is not about renting HDB since it has been over priced prepaid HDB rental all these years.

    rather

    the problem is about pricing into the rental land costs which cannot be so since HDB rental units are built on public land acquired on the very cheap for the purposes of national development

    of which public housing is one such national development priority.

    it never ceases to amaze what pea brained tan kin lian can come up with all the time. it is fortunate the nation, 70% sheep though it is, at least is not so stupid to have voted tan kin lian PE2011.

    tan kin lian is all cock, nil substance. all the labore is of no use if brain is nil sine substance.

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  • oxygen:

    THE OPENING PARAGRAPH of TKL moaning and groaning got it all wrong. Where got “home ownership” when animus domini (who decides the final outcome with all sorts of restrictions and short term lease buyback terms from the real owner) belongs to white ghosts. Peasants are already renting the structure AND THE LAND at inflated rates unsustainable of economic fundamentals (have to be funded out of cash savings AND CPF CONTRIBUTIONS meant for retirement).

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  • oxygen:

    TAKE OUT THE CPF CONTRIBUTION funding support option and adding loads of flats built for rentals, THE BTO pricing immediately will collapse like Hotel New World.

    ALL BUBBLES HAVE TO DEFLATE, the asset enhancement politics of prior decades is a scam that now needs an ever-expanding flood in of foreigners to shore up demand and keeps that bubble from bursting.

    Japan is staring at multi-decades of price deflation – they have a huge export industrial sector.

    LEE-jiapore? Heading for sudden death collapse and extinction IF THE PUBLIC HOUSING BUBBLE BURST THE SAME SPEED AS JAPAN DID.

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  • Money no buy prostate:

    Make sure to put all these solutions, ideas and suggestions or proposals on record so that the naive public will be aware if these ideas are copied in future.

    World highest paid.

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  • mike:

    Stop BS Mr TKL. “Home ownership” is a beautiful word just to milk and secure future income to the one who sell. It is a pretty word to isolate gahmen’s social responsibility.

    A 30year loan translate to more than 2~2.5X over principal amount depending on interest rate.

    You are pretending to be naive or what?

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  • Idol:

    What dillusional people who embraces capitalism and yet want to eat it, especially coming from a corperate person.

    Don’t you know there is a fine line between homeownership or, in conniving political language, you have a stake in the land and being owned by the rich(indebted).

    This can of wealth created or generated nationally , as you soon realize, is unsustainable without aliens invading your land and your children slaving and chasing for more money(die lah).

    So affordabilty is always from the perspective of the economist, not the political opportunist and layman perspective.

    Just quietly slave your life for your idol lah.

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  • Communist:

    Don’t trust the Pappies have a referendum. Let the People Decide

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  • Bobo:

    Frankly speaking, no parents would like to see that happens to their children and so on. Flat rental was a past short term solution in the 60s. Why should Singaporeans live in rental flat and foreigners who took over their job own a flat, Condo. or landed property? Nobody here wants to see Singaporeans ended up as Security guards, toilet/table cleaners, taxi/Grab drivers to service FTs.

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  • Harder Truths:

    Poor TKL not taking his medicine again. Maybe Jenny Craig can help.

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  • I no studi - I stupig.:

    Ah Tan… lucky you no our president. Now we all no u r so stupid.
    Do you know that oil price down but bus and train fair up.

    If we rent the greedy landlord will up the rental becsuee they one to buy computer and it is no $2 like the aim. So maybe $2,000,000 or more. How ar?? Rent go up la.

    How if landlord say the cleaners wages up, rental also up electricity up rent also up.

    So do you think you very silly?

    also you say if rent no need to give CPF. So how if we have 10,000,000 people and the G will be very busy to check so rent and if they die or deviose they will have to change.

    Please lah… Ah Tan, we rather you go and fly kite or play your marbles and enjoy.

    Also don’t stand for this GE. We guarantee you will lost your money. Better donate the money to the poor.

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  • John Lim:

    Like it or not, the only solution is to extend the lease when it expires.
    Why not ? When it was touted as “asset enhancement”, how can you then reduce its value to zero?

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  • oxygen:

    @ John Lim

    POFMA LAW DOES NOT APPLY TO THE WHITE MONKEYS on “asset enhancement” published claims.

    Want to extend your lease at expiry?

    Of course CAN!! Pay up on our terms, says the monkeys in white, we are owners, you are just tenants, peasants!!.

    John Lim: Like it or not, the only solution is to extend the lease when it expires.
    Why not ? When it was touted as “asset enhancement”, how can you then reduce its value to zero?

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  • NotMyProblem:

    HDB started in the right path and everyone was happy owning and stay in one.

    Starting from the 2G government with PAP’s lies and greed, HDB is now a burden for CPF members. It becomes a money making lucrative business for the PAP.

    All it needs now is to return back to the initial objective of HDB and cut away the greed and lies of the PAP.

    As long as the PAP denies it is a problem, there would not be any solution.

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  • I beg to differ:

    2020全球最好用護照出爐! 日本3連霸、台灣第32名
    https://www.google.com/amp/s/news.ltn.com.tw/amp/news/world/breakingnews/3033214

    Japan again 1st , Sg in 2nd place.

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  • Billionaire no $buy prostate:

    NotMyProblem:
    HDB started in the right path and everyone was happy owning and stay in one.

    Starting from the 2G government with PAP’s lies and greed, HDB is now a burden for CPF members. It becomes a money making lucrative business for the PAP.

    All it needs now is to return back to the initial objective of HDB and cut away the greed and lies of the PAP.

    As long as the PAP denies it is a problem, there would not be any solution.

    Singkies need to be spoonfed whats wrong with the system. They lack intelligence.
    The system will not willingly tell them whats wrong with the system.

    There are good reasons why foreigners are needed to replace the citizens by being new citizens. For example, for sg to be innovative enough, relying on sg born ones will take too long.

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  • John Lim:

    oxygen: POFMA LAW

    POFMA LAW is a debate stopper!!!

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  • COE:

    John Lim:
    Like it or not, the only solution is to extend the lease when it expires.
    Why not ? When it was touted as “asset enhancement”, how can you then reduce its value to zero?

    Yes, you are correct. That is what Indonesia is doing.

    So our HDB will be like COE. If time is up buy another COE and use it for another 5 or 10 years.

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  • Harder Truths:

    John Lim:
    Like it or not, the only solution is to extend the lease when it expires.
    Why not ? When it was touted as “asset enhancement”, how can you then reduce its value to zero?

    They cannot do that – they have already (de-facto) promised the land for redevelopment to certain individuals or companies.

    They will pay developers to tear down perfectly good housing, reconstructing the same (or smaller) d*ghouses using YOUR money at below-cost using FT labour.

    Then sell it as brand new to a new generation of FT & $G at MARKET RATE – who will borrow trillions off banks and spend their lives working to pay back a unit that is worth …. zero.

    There is a PLAN to follow you know…..

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  • Epitaph for a Conniver:

    Here lies unmatched ambition
    Money & prestige he would have no less than any other man
    Rob the young of their youth and spirit
    with debts a life long to pay
    Here lies his forlorn fortunes
    The cold cold earth by which he used to swindle the people of their high rise homes.

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  • Dafts Will Be Dafts:

    John Lim:
    Like it or not, the only solution is to extend the lease when it expires.
    Why not ? When it was touted as “asset enhancement”, how can you then reduce its value to zero?

    The asset did enhance but the money didn’t come to you but stolen by the pigs, conveniently with a paper given out by them.

    If the pigs are really concerned about the people, about the country, about sensible governance and provide housing for everyone, then extending the lease with a nominal fee is the easiest way.
    This was what many expected the government would do when they bought into the HDB scheme and trusted them long ago.

    We had a dead steward who promised to take care of everything, take care of this tiny property… why wouldn’t he as he was obscenely paid.
    Never would one expect his crown piglet to renegade in this social compact.

    Never would one expect the greed in pigs to grow into an outright theft.

    The pigs had gone astrayed, it’s time for a bakuktei party to give ourselves a real treat after years of milking.

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