15-04-2011, 07:25 AM
Not sure what is "wrong" with making HDB flats more affordable? MBT seems to be very against this idea!
Business Times - 15 Apr 2011
WP proposal will hurt resale prices, raise HDB deficit: Mah
By UMA SHANKARI
A PROPOSAL from the Workers' Party (WP) to lower Housing and Development Board prices by pegging new flat prices to median incomes will hurt resale prices and increase HDB's budget deficit, says National Development Minister Mah Bow Tan.
He also took issue yesterday with the WP's view that the high prices of HDB flats are caused by the ruling People's Action Party's (PAP) asset enhancement policies of the past 20 years.
'What is wrong with giving Singaporeans an asset, and what is wrong with making the asset grow in value? As opposed to what the WP is proposing, which is what I would call an asset devaluation policy,' Mr Mah said. He was speaking to reporters on the sidelines of a seminar organised by the Urban Redevelopment Authority (URA).
The WP on Wednesday defended its manifesto, saying that it is neither populist nor will it incur more government spending.
In particular, WP chairman Sylvia Lim said that new HDB flats are subject to a holding period, so there will be a time lag before her party's suggested policy of pegging new flat prices to median incomes filters through.
In response, Mr Mah said that there will be an 'immediate impact' on the resale values of existing HDB flats. Homeowners who try to sell their flats could find themselves to be in negative equity, he added.
In addition, as HDB already operates at a loss, he said, further reducing the agency's revenue by cutting flat prices means that the gap will have to be covered in some other way - such as through budget cuts for other departments, by increasing taxes or through dipping into Singapore's reserves.
For example, a 20 per cent decrease in the prices of new flats means that HDB will collect more than $1 billion less in revenue, Mr Mah said. He arrived at that estimate using HDB's planned supply of 22,000 new flats for 2011, and an average cost of $300,000 per new flat.
Business Times - 15 Apr 2011
WP proposal will hurt resale prices, raise HDB deficit: Mah
By UMA SHANKARI
A PROPOSAL from the Workers' Party (WP) to lower Housing and Development Board prices by pegging new flat prices to median incomes will hurt resale prices and increase HDB's budget deficit, says National Development Minister Mah Bow Tan.
He also took issue yesterday with the WP's view that the high prices of HDB flats are caused by the ruling People's Action Party's (PAP) asset enhancement policies of the past 20 years.
'What is wrong with giving Singaporeans an asset, and what is wrong with making the asset grow in value? As opposed to what the WP is proposing, which is what I would call an asset devaluation policy,' Mr Mah said. He was speaking to reporters on the sidelines of a seminar organised by the Urban Redevelopment Authority (URA).
The WP on Wednesday defended its manifesto, saying that it is neither populist nor will it incur more government spending.
In particular, WP chairman Sylvia Lim said that new HDB flats are subject to a holding period, so there will be a time lag before her party's suggested policy of pegging new flat prices to median incomes filters through.
In response, Mr Mah said that there will be an 'immediate impact' on the resale values of existing HDB flats. Homeowners who try to sell their flats could find themselves to be in negative equity, he added.
In addition, as HDB already operates at a loss, he said, further reducing the agency's revenue by cutting flat prices means that the gap will have to be covered in some other way - such as through budget cuts for other departments, by increasing taxes or through dipping into Singapore's reserves.
For example, a 20 per cent decrease in the prices of new flats means that HDB will collect more than $1 billion less in revenue, Mr Mah said. He arrived at that estimate using HDB's planned supply of 22,000 new flats for 2011, and an average cost of $300,000 per new flat.
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