Affordability Will Take A Hit If Developers Talk Up Prices

Source : The Business Times, Thursday, September 27, 2007

I REFER to the report, ‘Redas: Mass market poised for double-digit growth’ (BT, Sept 26).

It is interesting to note that the first vice-president of Redas, an interested party in Singapore’s booming property market, commented that just because mass market prices have not moved in tandem with prices in the high-end market, the former should have double-digit growth over the next 12 months.

Also, I regret to note the statement by the NTUC Choice Homes CEO that just because building costs have gone up, selling prices also must go up. There is an assumption here that the buyers of mass market property can and do have the cash to pay these higher prices and to service expensive mortgages.

The president of Redas, Simon Cheong, is wise to hint that choice locations will be hard to come by and the prices for such properties will continue to go up. This is very probable as he is targeting high net worth foreigners and high income Singaporeans.

In my opinion, the mass market developers’ comments look like attempts to talk up the market. My advice to Singaporeans?

If you are going to live to 85 and may not have enough money to tide over daily expenses, your best response to these ‘interested forecasters’ is: If you raise your prices, I will not be able to afford to buy your properties.

Lu Keehong Singapore