TR EMERITUS

With the elections looming ahead, the PAP is dishing out "carrots" again to "sweeten" the ground for itself. Speaking at a HDB event yesterday, Deputy Prime Minister Wong Kan Seng revealed that the PAP will be spending $1 billion dollars to upgrade some 85,000 HDB flats in central Singapore which will cover his constituency of Bishan-Toa Payoh as well. "I can assure you that as long as we have the financial resources, the Government will continue to extend upgrading to all other households eligible for upgrading," Mr Wong was quoted as saying in the Straits Times. Mr Wong did not elaborate on when the upgrading will start or if the plans will continue should the PAP lose in these constituencies in the next general election. The PAP has often used estate maintenance and upgrading to threaten Singaporeans to vote for them during elections. Former Prime Minister Goh Chok Tong once threatened to turn the two opposition wards of Hougang and Potong Pasir into "slums" if their residents continue to support the opposition. More than 85 percent of Singaporeans live in public housing built by HDB, a government agency. As a huge chunk of their life savings are tied up to their flats, they are an invaluable asset to them which makes them vulnerable to such "pork-barrel" politics employed by the PAP. The prices of HDB flats have sky-rocketed in recent years due to rising demand fueled by mass immigration in the face of a limited supply of new flats. DPM Wong urged Singaporeans to be "careful" when selling off their flats for a profit: "In today's brisk market, some of us may be tempted to sell our flat for a profit....Your HDB flat is meant for you to keep for the long term. It is a key source of financial security upon your retirement," he added. With the bulk of Singaporeans' CPF being used to finance hefty mortgage loans, they will have little spare cash left for their twilight year, let alone have any financial security to speak of.   Please join our Facebook discussion on this article here and invite your friends to do so as well to raise awareness among fellow Singaporeans.  Read More →

By Richard Lu What sets Singapore apart from all the First World capitals (and countries) and Hong Kong in particular is the very successful public housing program which has been the envy of many countries.  Perhaps Mr. Mah Bow Tan should be reminded of the history of the HDB. The HDB was tasked with the responsibility of providing public housing in 1960 to clear up the squatters and slums and resettling residents into “low-cost state-built housing”.   Led by Mr. Lim Kim San, HDB was to build as many low-cost housing units as possible under the First Five-Year Plan. It achieved its goal of completing 51,000 units of housing by 1965. The flats that were initially built were mostly meant for rental to the low income group. The largest project at that time was Queenstown, a satellite town of more than 17,500 apartments capable of housing close to 150,000 people. The Home Ownership Scheme later introduced acted as a hedge against inflation. It provided the home owners financial security. Later, CPF money for down payment was allowed. It was said that Mr. Lim Kim San and the HDB first Five Year Housing Program saved the PAP.  Today, 85% of Singaporeans live in HDB flats and is a testimony to the wise decision of our "old guard" leaders - Lee Kuan Yew, Dr. Goh Keng Swee, Dr. Toh Chin Chye, Hon Sui Sen etc.   Today HDB essentially provides the “roofs” for most Singaporeans and the HDB flats are a necessity rather than an asset or luxury.  HDB flats are leasehold properties that revert back to the government after 99 years.  No HDB apartment block or estate has ever sat through the full term of the 99 years lease.  The oldest HDB block or estate is at the very most 45 years old.  Only some Singapore Improvement Trust (SIT) built flats are older.  With the Selective En Bloc Redevelopment Scheme (SERS), HDB apartments and estates may not see through the entire period of their lease.  And it is therefore a myth to suggest that Singaporeans are “owners” of their HDB flats. They are at best considered as “long term tenants”. Singapore was founded 190 years ago and is 45 years as an independent nation.  Most of our forefathers came to this country to seek a better life and arrived in this country mainly penniless.  Through sheer hard work, luck and ingenuity, Singapore prospered.  Most Singaporeans are third or fourth generation migrants.  Each generation saves and passes on their wealth to the next.  Most Singaporeans have not inherited much because of the extremely short history span.  This is evidenced from the standard of living of the majority of the population and also the fact that 85% of the population lives in 99 year leasehold low-cost government built HDB flats.  If we consider a generation to be a span of 30 years, then the HDB apartment could be handed down to about 2 generations after the original purchaser. Unless continually upgraded and maintained, properties become dilapidated after 25 – 30 years.  In New York, most high-rise buildings are replaced after 40 years. Property and land ownership in Singapore are only recent phenomena to most Singaporeans as many of their forefathers arrived here with only a dream – a dream to seek a better life from their wretched existence then.   The majority of Singaporeans who live in public housing are also unable to own their apartments without HDB’s assistance and/or the borrowings of their CPF savings.  The list of true born-and-bred Singaporeans millionaires is not extensive and many are migrants who have earned their riches elsewhere or are scions of ‘old money’ families.   New HDB apartments To most Singaporeans, the HDB apartment is a roof-over-the head and nothing more. The demand for new HDB apartments is mainly generated by young couples wishing to start their families.  In most cases and increasingly, these young couples prefer to strike off on their own rather than to live with their parents.  These young couples are just starting their careers and cannot afford expensive apartments.  Beside an apartment, the young couple may also require a car to transport the young brood around and both, the apartment and car, take away most of their combine income. Unlike USA and countries with compulsory National Service, the only reward the Government gives the young Singaporean after completion of his National Service duty is the chance to own a HDB apartment if he wishes to start a family.  I am told that this is called “taking a bite at the cherry”.  The “bite” however comes with a list of conditions attached.  If prices of HDB apartments go up, only the state would gain.  The younger Singaporeans especially those from the lower income group ultimately suffer.  But this is only one side of the picture.     What if new HDB flats become unaffordable? HDB apartments must be affordable and made easily and readily available to younger Singaporeans, in particular those who have completed their National Service, for several reasons: a.     It is every young person’s dream to own their own home even if it is only a tiny HDB apartment.  When prices go beyond the reach of the young, they emigrate and we lose talents.  The brain-drain is a far more costly hemorrhage than the Government would admit; b.     Singapore will have procreation problems if our young choose not to marry at all or marry late.  The multiplicity of problems arising from late marriages are many e.g. child birth at an older age is medically more problematic and costly; it is also more difficult for women to conceive as they grow older, etc. There are also social consequences e.g. not enough young working adults to support an aging population, etc. c.     The cost of living generally goes up if the prices of housing stay high and this only adds on to the burden of raising a family; d.     Singaporeans have to work harder to pay off their bigger housing debts instead of spending quality time with their families or on other pursuits; and e.     Most importantly, the apartment and family gives the young Singaporeans a stake in the country.   Mr. Mah Bow Tan constant harps that the price of housing in Singapore is low compared to that in Hong Kong or New York or Paris or London and other capital cities.  He forgets (dementia perhaps?) that HDB apartments are purpose built low-cost public housing for Singaporeans. Singapore is not only a city, it is also a country.  Singaporeans do not have the dexterity of a countryside that its population can retire to when the cost of living in the city becomes prohibitive.  Mr. Mah must stop pretending the HDB flats are assets that are readily moveable and tradable.   The re-sale market Most young couples are unable to afford the COV (Cash-Over-Valuation – in some recently cases at more than S$ 50,000.00) and therefore the re-sale market is mainly one for up-graders and PRs. Young couples sit and wait (often in frustration), sometimes up to three years or more before being allocated new flats. When the HDB scheme was first announced in 1960, it was meant solely for Singaporeans.  Of course there were immigrant-PRs waiting for the Government to sort out their citizenships then.  Between 1960’s to 2005, immigration into Singapore was almost a trickle.  Only professionals and entrepreneurs were given PR status or citizenships. The floodgate to mass immigration into Singapore was thrown wide opened by the Lee Hsien Loong Government commencing in 2005.  Today the re-sale prices have shot through the roof and of most HDB units hover on the S$500,000.00 mark and some have even gone beyond S$ 900.000.00.  The deteriorating situation in the current HDB re-sale market is in part due to the sudden increase by more than 530,000 PRs into Singapore and HDB’s failure to provide a corresponding increase on the supply side.  Mr. Mah attempted to explain the failure by merely claiming that he was “surprised” and that HDB flats are still “affordable”.  The truth is that even the re-sale market is now becoming unaffordable for Singaporeans who are planning to up-grade.   HDB flat generate wealth?  This is a myth. High HDB flats prices cause inflation and generally increases the cost of living and doing business in Singapore.  There are other associated problems as well.   The very old and the infirmed are hardest hit. Since Mr. Mah became the Minister for National Development, the development charge for private properties have been raised and consequently HDB prices have also increased in tandem (see here). Mr. Mah Bow Tan and Miss Grace Fu should be reminded that wealth creation is not the function of the Ministry for National Development.  The writer of this article suspects that if Mr. Mah Bow Tan has his way, he would raffle or have Singaporeans bid for the apartments like the COE bidding system that he implemented for vehicles when he was Minister of Communications. He would also like to see the prices of HDB flats to be as high as private apartments in New York or Hong Kong or Paris or London.  From my re-collection, Mr. Mah has never created wealth for Singaporeans and emphatically this is was never his forte.  His COE bidding and ERP systems were both wealth-depleting for Singaporeans and many have simply given up driving altogether.   More importantly, what Mr. Mah is doing is wholly wrong.  All land in Singapore rightly belongs to Singaporeans – be it state land, leasehold land or freehold land.  Because we are such a tiny country (700 square kilometers) all land should be owned by Singaporeans or Singapore companies including our hotels.  It is a tragedy to see the Raffles Hotel that is part of our national heritage being kicked around like a football.  Perhaps Mr. Mah still thinks he is the Chairman of the FAS.  PRs and non-citizens should not be allowed to own low cost state-built HDB apartments.  New citizens should be subject to more stringent requirements before being allowed to buy and own HDB flats.  HDB flats should, as a rule, not be allowed to be rented out.  HDB flats must remain purpose built low-cost public housing for Singaporeans Elections must be held in Singapore by 2012.  Both Mr. Mah Bow Tan and Ms. Grace Fu are not exactly favorites amongst Singapore’s electoral candidates.  Unlike Mr. Lim Kim San who commands Singaporeans’ highest respect and who saved the PAP in 1965, Mr. Mah and Ms. Fu may have the dubious honour to be the harbingers of bad omens for the PAP.  They may, unwittingly, have begun the process of sinking the once mighty PAP Titanic.    Other articles by Richard Lu: 1. Why PAP MPs are no more a "wayang" in Parliament 2. Independent judiciary in a liberal democracy 3. Why an independent judiciary is an important part of a liberal democracy 4. Advantages of an open and democratic society     Debunking official myths of HDB flats series: 1 Myth 1: Singaporeans are “owners” of their HDB flats 2. Myth 2: HDB flats are “affordable” to most Singaporeans 3. Myth 3: Rising prices of HDB flats “generate” wealth for Singaporeans   Related articles: >> Letter to Mah Bow Tan on HDB policies >> Singaporean want govt to allay anxiety over HDB leasehold >> Mah Bow Tan embarrassed by Reform Party’s Hazel Poa >> Mah Bow Tan: “Unrealistic” expectations to blame for unhappiness about flats >> Taiwanese PR paid record $ 650,000 for 4-room resale flat >> Grace Fu: PRs are helpful to HDB flat owners selling their flats >> HDB launches “traveling exhibition” to trumpet its achievements in the heartlands >> PAP to upgrade 12,000 HDB households ahead of next election >> Mah Bow Tan: We do not want flat prices to go down >> Prices of resale flats to rise further as PR quota reached >> Taiwanese PR offers $50k COV for resale flat >> Mah Bow Tan: PRs have minimal impact on resale flat prices >> No empirical evidence to suggest that public housing is affordable in Singapore >> When will Singapore’s property bubble burst? >> Why HDB is unable to reveal break down costs of new flats now >> HDB to consider introducing rules to curb property speculation >> HDB blames Singaporeans for not selecting flats when given the chance >> Singaporeans worried about retirement after depleting CPF to pay for over-priced HDB flats >> Mah Bow Tan acknowledged that rising HDB flat prices has sparked “fresh concerns” >> PM Lee: Govt does not have control over prices of resale flats” >> COVs of resale flats shooting through the roof >> HDB resale price index hit record high in 2009 >> Singaporean wants PRs to live in rented flats instead of buying resale flats >> Singaporeans wants PRs to be banned from selling HDB flats at a profit >> Shanmugam: Singaporeans likely culprits for driving up HDB flat prices >> Mah Bow Tan: HDB flats remain affordable >> Means testing for PRs to buy resale flats >> Immigration and public housing: should the govt or people plan ahead? >> Grace Fu: hard to predict demand for housing >> Indonesian PR bought 4-room flat at $653,000 >> Mah Bow Tan asks home buyers to be realistic >> PAP MP blames young couples who cannot get a flat for not planning ahead >> Home affordability: HDB versus the public >> Demand vs supply: so many applicants, so few flats >> Number of applicants exceed number of flats >> HDB to increase supply of flats >> Mah: don’t compare with prices in the past >> ERA: 40 per cent of HDB flat buyers are PRs  Read More →

[email protected] United Legends share an intimate moment Results over an extraordinary weekend in the Barclays Premier League had re-ignited the title race with just three games left to play. The weekend started with Manchester United snatching an injury time winner over cross-town rivals Manchester City in a tight and nail-biting affair. The Manchester derby looked set to end in a goal-less draw (a rarity, for United had never drawn two 0-0 games in a row in the history of the Premier League), when Paul Scholes pounced to nick a header past City custodian Shay Given. A draw here would probably have handed Chelsea a huge advantage, but three points for United kept the pressure on. Chelsea started their visit to Tottenham Hotspurs later in the day, knowing that their lead had already been cut to a single point. Spurs were the team on fire, after defeating North London rivals Arsenal 2-1 days before. The home side started the game superbly, with half-fit striker Jermaine Defoe scoring from the spot just 15 minutes into the game. Left-sided midfielder Gareth Bale doubled their lead a minute before half-time to round of a wonderful week for himself. Chelsea found the going difficult in the second half again, with Spurs outplaying them in every department. Things got from bad to worse, when captain John Terry was sent off in the 67th minute for a second yellow. Frank Lampard did grab a very late consolation, but Spurs celebrated as this result put them firmly into the driving seat for the chase for the fourth spot. On Sunday, Arsenal were effectively eliminated from the title race when they fell victim to a sensational comeback from Wigan Athletic. The Gunners were cruising after taking a 2-0 lead with goals from Theo Walcott and Mikel Silvestre before the Latics staged the most unlikely of comebacks ever witnessed in the Premier League. Ben Watson first pulled a goal back after some good work by Victor Moses on the flank, before Titus Bramble pounced on a Lukasz Fabianski error to equalise from inside the six-yard box. The Gunners were still reeling from conceding that equaliser when Charles N’Zogbia took on three defenders to fire a shot worthy of winning any football match. Wigan’s three points here probably preserved their Premier League status, but for Arsene Wenger, it seems now inevitable to end the season trophy-less once more. At the bottom, Burnley fell 2-1 to Sunderland while Hull drew 0-0 at Birmingham. Portsmouth is already down, but it appears that Burnley and Hull are ever so likely to play in the Championship next season.  Read More →