The HDB versus the public

When news broke that the cash-over-valuation (COV) for a three room HDB flat in Toa Payoh had now reached S$70, 000, many Singaporeans wondered if public housing had become too correlated to the private property market.

The HDB’s flash estimate for the Resale Price Index (RPI) for the third quarter of this year is now at 144.7 percent - an increase of 3.2 percent from the previous quarter. The level of the index is now at its highest since its conception in 1998.

Now I’m not a xenophobe but it’s not rocket science that the surge in COVs are partly due to the influx of cash rich permanent residents who have been dropping flyers in the heartlands like my area in Jurong, promising attractive premiums to prospective sellers. This has put first time homebuyers such as young couples and singles like myself at a distinct disadvantage as we are less likely to afford the high COVs given our youth.

The HDB has defended its track record saying public housing is still “affordable”. However, “affordable” is such a relative word. How do you define affordability? Does it mean having to pay an exorbitant amount of money to have a roof over your head that you have very little left for your retirement?

HDB has also said that Singaporeans are choosy by wanting to live in certain places that are near their parents. If I were to buy a home, I would want a location near to my mum’s. After all, hasn’t the government been espousing on the importance of having a strong family unit?

Instead of spewing data to defend its track record, the HDB should come clean on whether it is a public entity operating like a private developer since it pegs its flats to the prevailing market rate. The HDB should also address anomalies that have resulted in escalating COVs. So until the HDB starts relooking at its housing policy, I’m staying put at my mum’s.