Are HDB flats too expensive?

Are HDB flats too expensive?

By iProperty.com Singapore – February 7th 2011




Are HDB flats becoming unaffordable for many Singaporeans? (Image courtesy of Singapore Tourism Board.)

Affordable public housing remains one of the most contentious and hotly-debated issues in land-strapped Singapore, results of a survey commissioned by Reach, the government’s feedback arm, show.

Despite general satisfaction with the government’s policies at home and abroad, the rising cost of HDB flats continues to worry Singaporeans, with 66 per cent of respondents registering government attempts to keep the cost of living affordable as an area of concern. While over three quarters, 76 per cent, felt that the supply of flats was adequate, just over half did not think housing was being kept affordable for most.

Although the survey was carried out prior to the latest introduction of cooling measures, the fact that house prices continue to rise, although the numbers of transactions is slowing, means that low-income households will still find it a struggle to cope with the rising cost of living.

Wait to Buy Private Homes

Meanwhile, HDB owners aspiring to upgrade to private property were urged to wait by Mah Bow Tan, Minister for National Development. “Housing prices are rather high now… if you wait for a while, you might find more affordable properties,” Mr Mah was quoted as saying, citing the expectation of rising interest rates and an increase in the supply of private properties as factors in curbing property prices.

The Straits Times reported that private home prices moved up 17.6 per cent last year, after rising just 1.6 per cent the year before. Non-landed property, which includes condominium units popular with HDB owners looking to upgrade, rose 14 per cent.

The newest property measures –- including high sellers’ stamp duties and lowered loan limits for second mortgages –- are, said Mah “meant to stabilise the market so that prices can increase at a more steady rate.” However, for those without hard cash readily available, they do put a large obstacle in the path of those who aspire to own private property.

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