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HappyHouse88

Expensive Hdb - Solve Housing Problem At Its Roots..

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http://www.channelnewsasia.com/stories/singaporelocalnews/view/1131904/1/.html

"Then there are all kinds of HDB rules that prevent them from renting. The rules are not frivolous.

"The problem HDB faces is that they are just short of rental flats. It's quite clear in my mind -- we need to ramp up the building of rental flats as quickly as we can. Not just by a few thousands; actually we need to (increase) by tens of thousands. And the earlier the better."

To say that HDB should not be for rental ...

 

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HDB was supposed to provide affordable homes for people living in Singapore. Instead of renting, to own the place where they stay.

And it shld go back to that.

I think most agree but it is how to do it without destroying peoples equity in the property they have already bought and at the same time allowing the young to get on the property ladder.

The primary reason for property prices to be high is because of low interest rate, high inflation and property appreciation over the last few yrs.

No, the primary reason is because demand exceeds supply.

The low entry cost of HDB flat have attracted both PR as well as wealthy Singaporean to use it as an investment tool by buying them to rent out. Rental yield is a whopping 15% in some units in the central. There were also people that bought flat and simply to wait out for it to appreciation. I heard of friends that never moved into their hdb flat and sold them 1 yr later when the MOP is up.

And where do these people live ?. If in condos then why are they also allowed to own a HDB ?. Surely this needs to be changed. Of course it is not so strange to expect more than a few of the various ministers friends or influential people to also be doing this so it would seem that it would be unlikely to happen. Older people may also be using this to provide a viable income as others have mentioned. Owning two properties should not be allowed. The door is closed on owning a foreign property and a Singapore one, although how they are going to realistically monitor it is a mistery. Now they should do the same for people owning two properties in Singapore. Of course doing this will put a lot of people renting out on the streets with no home. It will also seriously damage the finances of a lot of older people who may not be cash rich and are just surviving on rental income.

When HDB first started, HDB are not be sublet! And I think it's time for us to do that again. HDB are meant for Singaporean , PR alike to have a comfortable place to stay and not to worry about mortagage as their CPF could easily afford. Singaporean who wishes to stay in private shld be made to sell their hdb. And they are suppose to stay in their HDB and not sublet for high rental yield. With no attractive rental yield, i believe that people (singaporean, PR) will start to pay realistic price for their hdb. HDB is suppose to be affordable housing!

Mostly agree. people should be able to sublet their rooms if they are also living in the property. A couple may buy a 3 room apartment and supplement their income by subletting the spare room until they have a child. This seems reasonable.

Now the bit that seems not to have been thought through is where the 1.3mil non perm residents live ?. Bearing in mind that the vast majority are likely to be low income and so share properties in groups so they can afford the rents. You can try to force them to rent only Condos etc but that would be silly as it would be even greater cost for less space and of course all the other owners would complain about having 10 foreign workers moving in next door. You could send them all back if they could not afford the rentals but then you would need to be prepared to fill the empty jobs that leaves behind. Hope you like emptying rubbish chutes all day long.

And seriously, one reason why Singapore has been able to stay competitive is that Singaporean has affordable housing and ,thus, less pressure for wages to go up like Hong Kong.

You are aware of the 40% (approx) foreigners working in Singapore generally on lower wages than Singaporeans would demand especially for skilled jobs like IT. This is doubly true in industries that subcontract out positions to service companies. Remember the ministers wages are linked to the countries rate of growth. Import cheap labour to make it more attractive for companies as they have a cheaper skilled workforce. Companies happy, foreign workers happy, growth rate increases, ministers pay packet expands even more, ministers very happy. Singaporeans not happy, want to complain, have to apply for permit ;). Election time, suddenly ministers ears open once more. Yet to see if the fingers can accomplish what the mouth has promised.

MOP should be abolished, people shld be free to buy and sell when they need to. Especially for young family that may need to move because of childcare arrangement or aging parents shld be free to sell their house and move to place where it is more convenience or some cases cheaper.

Are you seriously suggesting this ?. Seriously ?. You really think this will help lower the HDB prices ?

Removing the MOP will make it more attractive to developers (ie. pte owners) to buy a HDB, renovate it and flip at a big profit if they have done their homework (good area, original condition, low valuation and cov due to condition, high val and cov for good units).

Having a 5 year MOP stops this or at least puts a lot more uncertainty in to the whole idea.

New buyers also need to modify their expectations and complain that they cannot buy a 5 room as their first place. For normal earners there is usually a process of working your way up the property ladder to get to where you want to go and not just buying in one big bang with a small cpf and then complaining that HDB is too expensive. Complaining that a 4/5 room is too expensive for a first time buyer just sounds like a spoilt brat whining. Some people are not used to the concept of working your way up in life....

RB

 

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recently i added mnd on facebook.

most of comments there are from people who need (or they think they need) help.

Groups of people:

1. young couple who wants to get married

2. young married couples

3. young married couples with children

4. singles

To me, groups 1 to 3 have a higher need than group 4, i.e. one house can meet the needs of 2 people. However, many singles are hounding the govt to let them buy a flat. This will certainly open floodgates, every single guy or ger will go out and buy a 4 room flat, pay for housing using max loan from monies from CPF and rent out rooms. This will enable them to cash in on CPF savings at a young age. Sounds like a very good idea!

I, for one, certainly do not want that to happen. We have enough of that these kind of people already.

As for whether flats are expensive or not, it really depends. I read in one tblog that says that he is looking for a table, on budget. So the appropriate one he or she found is from ikea, costing $500+. That to me is certainly expensive, but to him/her, its "budget". A matter of perspective i guess, no right or wrong.

To solve pricey hdb. --> what is pricey? And what price level would people stop complaining that it is pricey?

 

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recently i added mnd on facebook.

most of comments there are from people who need (or they think they need) help.

Groups of people:

1. young couple who wants to get married

2. young married couples

3. young married couples with children

4. singles

To me, groups 1 to 3 have a higher need than group 4, i.e. one house can meet the needs of 2 people. However, many singles are hounding the govt to let them buy a flat. This will certainly open floodgates, every single guy or ger will go out and buy a 4 room flat, pay for housing using max loan from monies from CPF and rent out rooms. This will enable them to cash in on CPF savings at a young age. Sounds like a very good idea!

I, for one, certainly do not want that to happen. We have enough of that these kind of people already.

As for whether flats are expensive or not, it really depends. I read in one tblog that says that he is looking for a table, on budget. So the appropriate one he or she found is from ikea, costing $500+. That to me is certainly expensive, but to him/her, its "budget". A matter of perspective i guess, no right or wrong.

To solve pricey hdb. --> what is pricey? And what price level would people stop complaining that it is pricey?

If singles can buy directly buy flat from hdb, I for one, will not want to get married haha!

 

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To solve pricey hdb. --> what is pricey? And what price level would people stop complaining that it is pricey?

Yardsticks:

- Loan full redemption after 30 yr tenure, must start the loan at age 25!

- WP's 20 loan tenure as reference?

- National median income as reference pt?

- instalment/income ratio?

- Loan, rental ratio, 20 yr, or 25 yr?

 

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Yardsticks:

- Loan full redemption after 30 yr tenure, must start the loan at age 25!

Can get 30 year loan up to 35yo.

Yardstick seems to be working until 65 not 55 when approving home loans, at least for OCBC.

RB

 

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Can get 30 year loan up to 35yo.

Yardstick seems to be working until 65 not 55 when approving home loans, at least for OCBC.

RB

No doubt banks allowed such, believed most of us, when reaching 55, don't want to live in such liabilities.

 

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No doubt banks allowed such, believed most of us, when reaching 55, don't want to live in such liabilities.

i suppose, a hope could be that, by then it would have been paid down partially/fully, even if there was a ways to go before tenure is up.

 

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No doubt banks allowed such, believed most of us, when reaching 55, don't want to live in such liabilities.

So it is preference rather than a requirement then.

I would prefer to have my home loan paid by 40yo but reality is that it is not going to happen unless I have a windfall.

Our initial home loan is 30 years but we will of course re-mortgage every 3 rears and top up to make sure it is cleared earlier than the full term.

Most of the time a home loan would be paid off via an inheritance but the problem with that in Singapore is no-one yet knows what the Gmt is going to do when the lease expires on peoples HDB apartments.

RB

 

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So it is preference rather than a requirement then.

I would prefer to have my home loan paid by 40yo but reality is that it is not going to happen unless I have a windfall.

Our initial home loan is 30 years but we will of course re-mortgage every 3 rears and top up to make sure it is cleared earlier than the full term.

Most of the time a home loan would be paid off via an inheritance but the problem with that in Singapore is no-one yet knows what the Gmt is going to do when the lease expires on peoples HDB apartments.

RB

I a bit "faster" than you. Got a $460K loan in 2009, last Fri submitted required docs to lawyer to process the full redemption.

 

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I a bit "faster" than you. Got a $460K loan in 2009, last Fri submitted required docs to lawyer to process the full redemption.

:D. Cool. Must be nice to be able to clear it.

Hopefully we will not be able to for a good many years as the only likely way would be inheritance and so the death of my parents.

TBH we would most likely have sold and moved to the UK by then to look after my folks in their old age as they have no-one else. That of course then brings with it complications on NS obligations for our 3 kids. Another problem for a good few years to come yet. No need to worry yet ;).

RB

 

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I a bit "faster" than you. Got a $460K loan in 2009, last Fri submitted required docs to lawyer to process the full redemption.

what's the motivation for that,if i may ask? you've mentioned before the low interest rate environment and how you put your $ to work.

Edited by random_username
 

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what's the motivation for that,if i may ask? you've mentioned before the low interest rate environment and how you put your $ to work.

This $466.2K was 90% of valuation of $518 which I took in 2009 with UOB. Lock-in 1 year, however comes with one "free" partial prepayment within lock-in. Another clause states MUST maintain >$80K within lockin period.

So, within lock-in, I made a partial payment(CPF) and left the outstanding some 83K from 466.2K. Now lock-in expired, however, get caught with clause 10.2 for paying back "subsided legal fee" if full redemption were to make within 3 years from 1st day of cash disbursement. This amounts to some $1688. The yearly interest would have incurred for 81K = 2.4K. Have to pay legal fee of $600 for processing full redemption. Ok, come to your query:

Because of low interest environments, I dump much of my cash into stock mkt and wife has been "nagging", 2 loans lah, put so much cash in stock lah....

1. Recent Allgreen's stock buyback has helped me get back some $111K from stk mkt, inclusive of abt 26K profit. Have asked son to be incharge and plan for yr end holiday.

2. So, to make wife happy( so I also happy) and my ears peaceful, I actioned.

3. Worth mentioning, this ($466.2- $81K)paid by cpf, 81k by cash.

4. Another loan(80% of 1.03mil) just got 1st cash disbursement 10% ($100.3K) on 1st June 2011. 20% of 1.03mil, stamp duty have been paid by cash. TOP 2014. Just nice, will be 50oy then.

 

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