HDB caters to 8 out of 10 S’poreans to suit different budgets & needs

The topic of the affordability of HDB flats was raised in Parliament on Monday during question time. In his reply, National Development Minister Mah Bow Tan has again emphasised that they remained affordable.

He explained the public housing body caters to eight out of ten Singaporeans earning from S$1,500 a month to S$8,000 a month with different types of flats, needs and tastes.

And the HDB is putting up Executive Condominium sites for sale in the confirmed list next year to offer more housing choices for the higher income group.

However, Members of Parliament said the affordability of HDB flats is an issue of concern among their residents.

Jessica Tan, GPC Chair, Finance and Trade and Industry and MP for East Coast GRC, said: “We know resale flats are rising in prices. How can HDB help to ensure that it stays affordable especially for the young couples who are looking to own their first flats.”

Mr Mah explained that affordability is about the price of the flat and the income levels of the families concerned. Also the type of flat they can buy would depend on ability to service the loan.

Mr Mah said: “HDB has a flat for every budget. At every income level, there are flats available, there is a choice whether it is new or resale, whether it is in the mature estate or non-mature estate.

“But there must be trade offs. The trade off is if you want to be in a mature estate, you have to look for a smaller flat. Therefore, when we say that HDB flats are affordable, we are not talking in abstract, we are talking in real terms.”

MPs added that another area of concern is the cash over valuation for flats.

Dr Lim Wee Kiak, GPC Chair, Transport and MP for Sembawang GRC, said: “The question is that ‘is the cash over valuation system still the best system that we have or can we think of alternative to this cash over valuation system?’ Many people are CPF rich but cash poor when they want to buy a flat.”

Mr Mah explained that cash over valuation was not unique to HDB flats, but part and parcel of today’s property transactions – whether private or public.

He said: “Buyers can choose not to pay a cash over valuation. And in fact, the latest data shows that almost one third of transactions today are transacted at or below the valuation. So cash over valuation is not a forgone conclusion. It’s not evident for all transactions.”

Mr Mah’s advice to flat buyers is not to simply cough up the Cash Over Valuation when asked for by sellers or agents, but shop around and get the best deal for their preferred flat.

Source : Channel NewsAsia – 14 Sep 2009

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