My darling government should be concerned. In fact, it should be very concerned. Clearly, Singaporeans are now not afraid of their government. At least, not in the investment realms. Ok, add marriage and having babies to that list of things that Singaporeans simply don't care two hoots about what the men and women in white are urging us to do.
Singapore is likely to witness the first case of an HDB apartment - with a 99-year lease - to be transacted at a whisker under $1 million dollars. For those like my fortunate friends in the US who are not aware of leased land, the government allows Singaporeans to own their HDB flats for a lease period of 99 years. While that is stated on paper, Singaporeans will have to give up their flat should the government want to conduct en bloc upgrading of the estate or when the housing lease is up, whichever is sooner. At the current state, the former is happening more frequently than the latter. I have yet to see 99-year-old flats being repossessed by the state.
I shall not delve into the ethics of evicting me from my home - technically, I am not even an HDB apartment owner - or discuss the immorality of forcing me into another housing loan for a new flat that I don't want - many other Singaporeans cannot wait to move out of their free-range chicken farm into a chicken coop - but I shall say that HDB housing, a right of Singaporeans, is now becoming elusive.
It is so elusive that a single man can expect to fork out his arm, his leg and may be what hangs between his leg to buy an HDB flat. And add to that, he can pledge his heart, corneas, lungs, kidneys, and testicles even (!), to secure a housing loan, which he can expect to service for the rest of his life. (The gender under question is intentional - a woman "can expect to service for the rest of her life" sounds way too colourful for the G-rated nature of this innocent looking blog. *Blinks innocently*)
Now that the Bishan Executive Mansionette is going for S$900,000, Singaporeans are now of the belief that the shit hole they live in is worth twice as much as was valued by the HDB valuers.
Before we go forward, let us take a giant step back to see this travesty through the eyes of this innocent blogger. *Blink blink blink (think Bambi)* Let's do some sums!
Total value of unit - $900,000
Cash-over-valuation - $170,000 (This portion needs to be paid for in cash!)
Valuation - $730,000 (I don't quite believe this; EM valuation hardly break 700k)
5% cash downpayment on Valuation - $36,500
15% cash/CPF downpayment on Valuation - $109,500
80% or less bank loan on Valuation - $584,000 (If you decide to take a smaller loan, you have to fork out even more cash or CPF.)
In other words, this buyer has a total of at least $206,500 in cash sitting freely around! House buyers (or potential ones) know that there is still stamp duties to be paid on the house and lawyer fees!
How in the world did this happen?
Many worker bees like us are required to either go out and collect pollen and feed the hive or spend the whole time breeding the Queen Bitch. I mean, the Queen Bee. For the pittance we are often paid, how do we accumulate $200,000 in cash at all? I am hard pressed to come up with HALF that amount, much less have the full $200,000 lying around.
Given the CPF caps that are applied since two recessions ago, CPF is paid for the first $4500 of our salaries. This is again a complicated calculation process but it is suffice to say that there is very little likelihood to build a CPF to that grand scale as above.
Although market watchers will dismiss these HDB windfalls (for the owners) to be one-off, most houseowners will be emboldened by the news and begin withdrawing their units from the market and relaunch them at even higher prices. I have already experienced that with a few units I viewed recently. What will this world come to?
How is it possible for a single Singaporean man to own a roof these days? *Continues in his search for the Widowed Childless Rich Old Dying Datin*
4 comments:
I shall never whine, rant, or grumble ever again about the cost of housing in the United States.
I am amazed, shocked, and stunned by what you have to deal with for housing in Singapore. How can anyone afford to live?
I'm shocked, I tell you. I wish you well, but never in a million years would want to have to deal with what you are dealing with. Ever. Sheesh.
I'm shocked... but not speechless (LOL!)
When availible land is at a premium, costs rise accordingly. We, in the US, have much in the way of available land in comparison with Singapore.
We see the issue here too (Oregon)and not on the same scale at the moment but it occurs now too.
You are correct: population growth is the bottom line issue and until it is openly addressed, we will smother ourselves from irresponsible breeding habits.
China's one baby per family policy has potential but also a lot of implemetation issues left unresolved.
Sounds like a task for the armageddon folks - LOL - not my idea of a sound solution either.
Ironically, people are going into fake marriages to get highly subsidized HDB flats and married couples don't want to have children.
To some extent, our immigrant population are driving housing prices up but the larger problem is with people buying subsidized HDB flats and investing their monies in private properties, hoping to make a quick killing there.
Housing is a basic necessity, unlike stocks or Lehman mini-bonds. One should not speculate in property and then deprive others of a place to stay in.
I am not against people buying private properties. I am also of the opinion that the government is right when it says there are enough houses to go around. What is wrong is the policy. We need to review HDB ownership rules to require HDB dwellers who own private properties to either give up their HDB flats, or pay the full 100% property tax on their private property. We have enough for everyone's needs but not enough for everyone's greed.
People have resorted to buying Mickey Mouse-sized private housing apartments the size of 3 parking lots in a bid to make a quick buck on a small outlay. Our market is going crazy...
I can't wait for the economic bottom to fall out again!
See, thats why I say buy Local Property Developer stocks. This time round, it will be the physical market leading the rebound in property stocks and not the other way round.
And guess what? Our New Citizens has the cold hard cash to pay 1million for our HDB flats! =D 10 years ago, it was the sucker singaporeans that paid a million for the bishan HDB.
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