In the past, economy was growing in the whole region From Singapore to Taiwan, US plants were shifting out of US to avoid the high local salaries on low level workers. They moved the factories out of US into Mexico, Asia etc which house their low cost factories. US was the economic driving force for Singapore.

With the wealth of manufacturing in the 70s, 80s and 90s, the decline start to show in since late 90s. Singapore changed from the back bone manufacturing into financial services. Despite being the hub of many high tech manufacturing sectors for US, Singapore never retained any people nor technical know how. When US investors pulled out, the Singapore government embraced financial services and took after the model of London.

Already, UK has showed decades of decline by loosing technology know how and manufacturing, falling way behind US, China. However, Singapore government did not learn from the mistakes of UK but instead followed on.

Now, Singapore is hit by a global down turn in which demands are falling more than 50-60%! This is very bad news because the manufacturing sectors are now wiped out and will not recover again. Many US executives have now decided to move to China for every consumer electronics, heavy industry and medical supplies. Singapore technology was a Hawker Center style management. I will make what sells well. The industry and even university have sub standard technical people. How to compete even with the surrounding countries.

Never mind industry, lets move to financial services. Singapore took on financial investments heavily and true enough, made over S$150 Billion in recent years. That was a big achievement. But bear in mind, how much was bubbles or inflated values on paper?

Today, April 09, we can see it hitting Singapore hard now and will be worse. No more jobs, no more demands, no more industry. People who came in as foreign now are moving elsewhere very rapidly.

I predict by end of Q3, private property will be half of the value, as more and more default payments and enter bankruptcy.

Even those who were holding prime properties will be hard hit because income has fallen sharply, they cannot maintain the same payment. So, prime will become subprime property. This is a dangerous vicious cycle.

The worse thing is many developers pushed out properties recently, dumping so much units and get the banks into heavy commitments. The banks should have halted all these loans as they are already badly hit by the global exchange and lost billions in loans. Were are the cash coming from?

I also predict Singapore will enter into the subprime crisis mirroring the US American downfall. There will be many out of job and not able to service their loans. We already know it is all too common for salary cuts and the cost of living in Singapore continues to rise, never plunge. Inflation figure is way higher than official.

Once again, the government fail to look into the examples of US decline and continue to cash in on property sale. I feel very sorry for people who committed to properties in the past two years. Especially those who are buying property in Q1 09 needs really think of a way out.

The world’s worse is yet to come, and committing to property at its artificial peak only speaks of the mentality of many Singapore’s folks. If you want to look at the figures, check the US sites and see the global trend. Singapore has not seen the bottom yet.

i strongly believe that the government is trying their best to do what’s possible in their most favourable outcomes, perhaps government first, then us. The housing pricing is indeed hilariously high as all of us try to debate this.

Even if the most eloquent speaker from the government would argue otherwise that since we have cheaper alternatives to choose from, then it is really not their problem. It has become a major hotspot for discussion and in no means, working towards our way because all DBSS is commerciallised and the plot of land sold is for such a high premium and i strongly believe that if government wishes to do more for us, the first time house buyer deserves a place in a matured estate, they should either pass off some rebates in terms of lower interest or additional housing grant.

Afterall, the poor and the middle income are very closely knitted in terms of pay and mostly squeezed by the parties involved.

So to the government, we need cheaper housing and pls dun push us to faraway suburbs because we cannot afford.

Today, a 4 room HDB flat in Punggol will cost about 4 years of a combined family income (with both spouses working). Two working persons does not mean that they have double the income. There are expenses to be spent in commuting to work, eating outside, clothes, etc. There is also the need to pay for a maid to work in the home and look after the children.

A HDB flat, at today’s prices, is a big burden to the family. It is no longer affordable. This is one factor that accounts for the reluctance of many family to have children. They cannot afford it.

The monthly installment for a HDB flat is barefly affordable, if both spouses have full time work. If any spouse is retrenched, it will be a burden. There are many cases of installments in arrear.

At present, the interest rate on HDB loan is 2.6%. If the interest rate moves up to 5% due to a rise in interest rate in the future, the monthly installment will increase by 25%. This can be a source of future problem.

What can ordinary people do? Do not over-commit to buy an expensive HDB flat. It can be a burden to your family finances.

If you are counting on the combined family income of both spouses, choose a flat that cost three years (not four years) of the combined income. Keep some savings for the future.

If many people are more prudent in their spending, there will be less demand for HDB flats and the prices will not keep on escalating.

no wonder PRC so $$$,

their house not so x,

then got cash $$$ on hand la…

but look at here, very tough here leh..

aiyoyo

there is a saying, ‘with friends like these, you don’t need enemies.’

how to translate this quote in the context of govt and people?

and they talked about transparency whoa?

Thanks for your letter shown on post #74.

It clearly shows that when you buy new HDB flats during the boom period which was during the past two years, you may have buy them at the high end. This is not unlike of purchasing flats from the resale market which follows the economic environment. This trend also follows that of private units.

Of course, HDB has factored in about 20% off the prevailing sales prices of resale units but we have seen that prices of flats can go down more than 20% in a down period. Thus, HDb I think has tricked us all along by saying that they have subsidised units. They do if the prices stay flat ie. the prices of flats do not fluatuate but we all know that resale units act like private ones and they do swing wildly at times.

For example, a HDB resale executive unit in the 1995/6 was quoted at $600K average but the same unit dropped to as low as $450,000 during the down period immediately after 1997 Thain financial crisis period to 2006. Prices only went up during the economic boom of 2006-2007. Prices have since dropped off slightly due to the current recession. It is expected to drop further next year.

As valuation follows that of the economy, those who buy at the high end last year or earlier may be screwed even with the subsidy given by HDB. They may have to stay in for a long time or wait for the boom period to return soon.

We provide affordable homes of quality and value.
We create vibrant and sustainable towns.
We promote the building of active and cohesive communities.
We inspire and enable all staff to give of their best.

I think they should just strike off the first line in their mission statement.

Why not ask them how come they want to peg prices to market rate as opposed to construction costs?! I don’t buy the argument how our flats could be ‘heavily’ subsidized if condo units only cost marginally more. Unless of course HDB had been ko-toked by the same construction company over the years. The maths just don’t tally….

We thank the writers for their feedback.

Ignatius Lourdesamy
Acting Deputy Director (Marketing & Projects)
for Director (Estate Administration & Property)
Housing & Development Board

according to the above letter, comparing against earlier launch prices is not meaningful. so comparing latest market price is meaningful. can hdb show the public how they derived at the pricing for pinnacles and how much is the generous discount given in these cases?

PR cannot buy new flat. Sorry

Yes, you are right on that. How can I missed that? SERS! You are so clever! However, SERS they bor make so much money lah.