Friday, August 3, 2012

Buy low, sell high desire - HDB's dilemma

Straits Times: Wed, Aug 01

LAST Thursday's article ("PRs in the HDB market: Boon or bane?") offered valuable insight on the policy dilemma faced by the Housing Board.

If tough measures are taken to drive permanent residents (PRs) away from the resale market, the demand for resale flats will shrink and deflate the market.

This will affect Singaporean resale flat sellers because the value of their properties will drop. However, if resale flats become too attractive to PRs, Singaporean resale flat buyers will bear the grudge that PRs are owning flats meant for citizens and might even assume that their ulterior motive is to gain from the rental income.

So, it is hard to please every Singaporean who is buying or selling a flat because everyone wants to buy a cheap flat and sell it at a high price. The difficulty in this issue is to strike a good balance in controlling the accessibility and attractiveness of resale flats to PRs, such that the prices of resale flats will remain relatively affordable for Singaporeans, while ensuring that current home owners can see their properties rise in value.

We must accept that the housing policies that HDB introduces may not always be favourable to some of us but it may just be the best balance that HDB is trying to achieve to benefit the largest pool of Singaporeans.

Jonathan Leaw

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