Ex-GIC chief economist to government: Lower the price of public housing
Posted by temasektimes on August 28, 2012
Despite repeated public proclamations that HDB flats remain ‘affordable’ to Singaporeans, many do not think so including the former chief economist of Government of Singapore Investment Corporation (GIC) Yeoh Lam Keong who called on the government to lower the price of public housing.
In an interview with Yahoo News, Yeoh questioned the rationale of linking Build-to-Order flats to general market prices by being pegged to the cost of resale housing.
“Once you do that, BTO prices will rise as general property prices rise, and resale prices are already often five to six times that of low to median (annual) incomes, making housing very unaffordable by most conventional housing industry measures,” he says.
Yeoh explains that as property market prices tend to be pulled up by the cost of upscale, private and landed property, they will price out everybody else who falls below the top 20 to 30 per cent of household.
“BTO flats should be priced at a range of between two and three times of low to median annual incomes instead of between three and four times, where BTO prices currently stand. This artificially lower subsidised price would be available only to Singapore citizens,” he proposed.
The prices of HDB flats have nearly doubled in the last decade due to the relentless influx of foreigners while the salaries of ordinary Singaporeans have remained more or less stagnant.