Dear Mr. Tan
We could improve the affordability of owning a HDB flat without crashing the prices of existing HDB flats by:
1) With immediate effect, cut the prices for all new HDB flats by 5% and:
rebate 4% to those who had purchased their flats within 1 year
rebate 3% to those who had purchased their flats within 2 years
rebate 2% to those who had purchased their flats within 3 years
rebate 1% to those who had purchased their flats within 4 years
rebate 4% to those who had purchased their flats within 1 year
rebate 3% to those who had purchased their flats within 2 years
rebate 2% to those who had purchased their flats within 3 years
rebate 1% to those who had purchased their flats within 4 years
2) for the next 5 years (2011 to 2016)
peg the increase of prices for new HDB flats at 3% lower than the increase of the national median income.
peg the increase of prices for new HDB flats at 3% lower than the increase of the national median income.
For example : if the increase of median income is 5% for that year then the increase of prices for new HDB flats should be 2% for that year. If the increase of national median income is 2% for that year then the prices for new HDB flats should be decreased by 1% for that year.
With 1) & 2), we can achieve the effect of a 20% “reduction” to the prices for new HDB flats within 5 years without crashing the prices for existing HDB flats.
With 1) & 2), we can achieve the effect of a 20% “reduction” to the prices for new HDB flats within 5 years without crashing the prices for existing HDB flats.
For the longer term, the increase in prices for the new HBD flats should be pegged to the increase in national median income.
Pang
2 comments:
Just a suggestion:
Maybe for new HDB flat, in order not to have an impact to the existing HDB market price, HDB may consider having a lower interest rate for 1st time buyer.
HDB can still use the same model of pricing their new HDB flat. But first time buyer will be offered a special low fix interest rate which can be 1 to 2% below CPF rate.
Example: using 2%(Note: this % need to be evaluate) below cpf rate = 0.6% interest rate.
This will effectively allow young couple to pay a lower installment (note young couple usually does not have a high salary initially) and at the same time this gives a indirect discount to first time buyer by reducing their interest paid. Which eventually is much cheaper. This will not affect overall HDB market too much as this rate applies only to first time buyer for new HDB only.
Might solve the problem for young couples.
Edmund
By Warren Buffett
“A house can be a nightmare if the buyer’s eyes are bigger than his wallet and if a lender -- often protected by a government guarantee -- facilitates his fantasy."
“Our country’s social goal should not be to put families into the house of their dreams, but rather to put them into a house they can afford.”
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