Source : The Straits Times, Mar 8, 2008
THERE have been calls for the Government to review the $8,000 income ceiling for new HDB flats. I would like to state the realities of life as a typical (lower) middle-income Singaporean.
Life was rosy until we decided to look for a roof to start our new family. A check on the HDB website showed a new four-room flat in Punggol selling for about $230,000.
However, we exceeded the $8,000 income ceiling by about $1,000.
We exceeded the HDB cap not because we are high fliers but because we found each other only after some years of work. We were in our early 30s by the time we were ready to settle down. Not to worry, the Government says, there are options for us:
Resale Flat
The resale price for a four-room Punggol flat is about $310,000. This means we have to fork out an additional $80,000. This is not a small sum. Furthermore, it was an old flat and we were wary about loan sharks calling on the former owners. We would also have had to spend more money on refurbishment.
Executive Condominium
We thought we could try for executive condominiums as our combined income was still below the $10,000 cap for this category. To our shock, we found that the units were selling for at least $650,000 (in suburban Choa Chu Kang and Woodlands). Should we fork out thrice the amount of money for a new HDB flat, just because we exceeded the Housing Board flat cap by $1,000?
Private Condominium
I shan’t go into this because the prices are just ridiculous for couples like us. At this point, our feelings are a mixture of unhappiness and helplessness.
The initial excitement about starting a family has been dampened. The moral of the HDB limit appears to be: don’t fall into the ‘in-between’ income group.
You either have to settle for an old flat which costs about $100,000 more, or spend the rest of your life paying for a new executive or private condominium.
And you wonder why there are no ‘in-between’ choices. Some say this is the Government’s way of persuading us to marry early.
If that is so, the Government should be realistic enough to note this rising trend among Singaporeans in marrying later, and failing to qualify for a new flat because of it.
Xu Zhilin (Ms)
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Raising HDB income ceiling will hurt needy
Source : The Straits Times, Mar 12, 2008
I REFER to Saturday’s letter, ‘ HDB ceiling doesn’t factor in late marriages’. Ms Xu Zhilin says the $8,000 income ceiling doesn’t consider the trend among Singaporeans of marrying late, resulting in a combined income that is slightly higher because they have worked for a few years. However, this ignores the point that there are many lower-income people in need of HDB housing, and Ms Xu is not alone in looking for a roof to start a family.
The critical factor in buying a flat is not how late you marry but how much you can afford to pay.
As one whose household income is half of hers, I have to say that if people like Ms Xu were allowed to enter the HDB market, prices would rise even further, putting housing out of reach of low-income earners.
The current rule is that four-room household incomes should be between $4,000 and $8,000.
I do not see why Ms Xu, with her $9,000-plus income, wants to compete in the market against a household earning half her income.
The same low-income people also face her stated problems of refurbishment and paying more for a resale flat, only their problems are double hers as they have half her income.
Prices of four-room flats now range from $200,000 to $300,000. If someone earning $4,000 a month must fork out $300,000 for a flat, there is little reason why someone earning $9,000 cannot afford a $600,000 flat.
Most people take 20 to 30 years to pay for their HDB flat. With Ms Xu’s income, she could probably pay for it in half the time, sell it for a profit, and move into private housing.
Ms Xu may not be a high flier, but having reached this level, her income is less likely to be static and thus she will have more options to move into private housing later. But incomes of the less well off are more likely to be static, giving them fewer prospects to move up. Where will they go when flat prices rise?
Ms Xu says she will have to spend the rest of her life either paying $100,000 more for an old flat or paying for a private condominium or executive flat. I say welcome to the real world.
Liew Lin Hai
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