The annual report of the Housing & Development Board (HDB) showed a variation of up to 50% in the price of a 4 room HDB estate in Punggol during 2008/09. Why should the price of the flat vary by so much for the same location, type and year? If we allow for closeness to MRT station or amenities, the difference should perhaps not exceed 15%. A large part of the difference could be due to the volatity of the property market during this year.
While the market was volatile during this period, due to speculation, it would be better for the HDB to stablise the market by setting the benchmark pricing, rather than add fuel to the speculation. If the HDB were to offer a large number of new flats at stable prices, it will give comfort to the home buyers that prices will be stable (and still reflect the market) and will not increase sharply due to supply shortage or speculative demand. It will reduce speculation and fear.
I hope that the HDB will play this important role of stabilising the market and still have prices that reflect the economic growth of the country and the income level of the people. The Singapore economy will be stronger, if the prices of housing and many other cost of business are kept stable (and still reflect the market price in Singapore or globally) and not manipulated by speculators.
Tan Kin Lian
Reminds me of Dubai. The only difference is poor Singapore citizens are here paying so much and have to stay in it for long.
ReplyDeleteIMO, with the market pricing policy, the people running HDB is probably incentivised to ensure the resale HDB market is as optimistic as possible. They can do this by keeping a tight control of the supply of new HDB flats. This will result in high profit margins and in all likelihood, good salaries and careers for HDB staff.
ReplyDeleteThis is similar to ministers being incentivised to increase GDP and keep it as high as possible.
Not unlike bankers' bonuses pegged to trading commissions, sales of whatever products etc etc, irrespective of suitability of the products or sustainability of the whole process.
The problem with this type of KPIs and incentive is that it does not necessarily translate to citizens well being. Yes, the headline numbers look good, gives impression that S'pore is moving ahead, and attracts MNCs and investors.
But who really benefits? The top 20% of the population? Or the bottom 50%?
Govt in s'pore is operating too much like profit-making company, and too many people in govt have entitlement attitude to bother with average citizens concerns or to "stabilise the market".