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affordability: NSP’s Goh

Tan Weizhen

weizhen@mediacorp.com.sg

SINGAPORE

At current housing prices, buyers will have to service their loans for the next 30 years, which will wipe out the CPF accounts of many buyers, leaving them with little for retirement, NSP secretary-general Goh Meng Seng said in response to recent comments by National Development Minister Mah Bow Tan.

Mr Mah had said on Sunday that eight in 10 couples who buy new flats use only a quarter or less of their salaries to service their home loans, because they use their CPF. Combined with housing grants, a couple earning $4,000 could get a flat with “zero deposit”, he had also said.

But Mr Goh said many young people he has met on the ground cannot afford flats, even with a 30-year mortgage: “A 30-year mortgage isn’t affordable. It would mean that all the youngsters now, in 30 years’ time, wouldn’t be able to retire CPF would be zero. So what gives?

Our future generation will suffer.

“To say that — not forking out cash for deposit — is a myth.

It has created a wrong sense of affordability.”

His NSP team distributed flyers at the Tampines MRT Station last night. The NSP is contesting Tampines Group Representation Constituency, where Mr Mah is the People’s Action Party anchor minister.

Mr Goh also defended his proposal that permanent residents should have a longer minimum occupation period for HDB flats:

Eight years, compared to five for Singaporeans.

Mr Mah had rejected that proposal as housing policy was already “stacked in favour” of Singaporeans.

Mr Goh responded by saying there should be a mindset change with regard to PRs: “Whoever we want to attract, we should have the motive to make sure these PRs will become our citizens. We don’t want (PRs of) a migrant nature.” He believes that raising the criteria to eight years will elicit more commitment from PRs, as a flat will then become a home to them and “the natural path is to become a citizen”.

As for local issues NSP will campaign on, Mr Goh said Tampines has a number of problems, including an ageing population, lack of car park spaces and poor estate maintenance.

Some ageing HDB blocks have leaking roofs and peeling paint, he said.

His proposals include a community hospital to serve the elderly in Tampines, Simei and Pasir Ris-Punggol.— Paying nothing as a deposit for a new flat or covering monthly mortgages with Central Provident Fund contributions do not mean public housing is affordable, the National Solidarity Party said yesterday.

COV down 9% in Q1

Analysts divided if cash over valuation will fall further or hold

Linette Lim

linettelim@mediacorp.com.sg

SINGAPORE

COV premiums for HDB resale flats dropped 9 per cent, or a S$2,000 decrease, to S$21,000 for the first quarter of this year, according to data from the Housing and Development Board.

Observers attributed the decrease to the Government’s cooling measures but were divided on whether COV premiums have bottomed out or will continue to drop.

“Currently, the COVs have come to a point where it is not going any much lower,” said PropNex chief executive Mohamed Ismail. “Based on our Prop-Nex data, the COV for the month of April has already gone up to a median at S$23,000, which is where we were starting prior to the first quarter.”

However, Cushman & Wakefield vice-chairman Donald Han reckons

COV premiums will continue to fall.

“I think the fact that there’s going to be 22,000 new HDB dwellings going up in the marketplace, and the Government’s ramping up ... its development mission to develop more HDB properties ... will mean vendors cannot hold on to their COV asking prices,” he said.

The Resale Price Index increased 1.6 per cent in the first quarter, compared with 2.5 per cent in the previous quarter.

While the total number of resale transactions fell by about 4 per cent to 6,228 cases, the proportion of resale cases transacting above valuation remained at 96 per cent.

Meanwhile, median sublet rents during this period remained relatively stable with increases for one-room and five-room flats and decreases for two-room flats.

Subletting transactions rose by 8 per cent to 6,365 cases.

The total number of HDB flats approved for subletting rose to about 36,400 units in the first quarter, compared to about 35,000 units in the previous quarter.

In a separate announcement yesterday, HDB said that it will launch another 3,185 flats for sale under the Build-to-Order (BTO) exercise for this month.

HDB said it will offer 22,000 new BTO flats this year if demand is sustained.

Last year, a total of 16,000 BTO flats were offered.

Despite the supply of new flats coming onto the market, Mr Han thinks that there could be a 1- to -2-per-cent uptake in HDB resale prices over the next one or two quarters.

Mr Ismail also thinks that the resale prices will trend up, as the new supply of BTO flats is not a perfect substitute for the resale units.

“Even though there are 22,000 (new) flats, there are many people who will still choose to buy resale because they can’t afford to wait three years to get the keys,” said Mr Ismail.

“On that basis, I will see it as two different markets.”— HDB resale prices went up in the first quarter of this year, but Cash-Over-Valuation (COV) premiums fell during the same period.

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‘lost his way’: Lim Boon Heng

SINGAPORE

Mr Lim yesterday joined the line of some People’s Action Party (PAP) ministers in refuting Mr Tan’s economic proposals and his view that the PAP has lost its moral compass.

Speaking at a community event, Mr Lim said it is positive that a former civil servant is taking on the PAP as it allows the public to reflect on different points of view.

“I think Mr Tan may have lost his way ... perhaps he is trapped in a time warp. He has been out of policy-making decisions for quite some time or perhaps he is lost in the forest and going around in circles ... the world has moved,” said Mr Lim.

Minister of State (Trade and Industry and Manpower) Lee Yi Shyan also commented on Mr Tan’s proposal to move away from manufacturing and focus on services, saying an economy without manufacturing would be difficult to imagine.

Mr Lee, who spoke at the release of survey findings by the Customer Centric Initiative, said it was manufacturing that helped to pull Singapore out of the last recession.

He said: “If Singapore were located elsewhere, then maybe our service sectors, our consulting firms, accounting firms, our legal firms can practise in a wider region.

“But the reality is that there is limited market reach of service companies, so we always need the manufacturing that can help us connect to the world.”

Mr Lee, who is likely to stand in East Coast Group Representation Constituency, said the PAP is ready for contest. “Well put it this way, we have been doing a lot of consistent work, so we will be very disappointed if opposition doesn’t come and we are ready for a good fight,” he said.— Minister in the Prime Minister’s Office Lim Boon Heng has said that Singapore Democratic Party candidate Tan Jee Say has been out of policy-making for some time and may have “lost his way”.

Opposition set to contest 82 seats

Only 5-member Tanjong Pagar GRC likely uncontested, NSP set to field biggest slate of 24 candidates

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