Leong Sze Hian

What has record HDB prices got to do with falling private property prices and the number of students graduating from tertiary institutions?

According to the article, “HDB prices hit record high” (Today, Jul 24), prices of HDB flats rose 1.4 per cent in the second quarter. Sales of HDB resale flats also surged 58 per cent, reflecting improved market sentiment, the report said.

Resale transactions were 10,184 in the second quarter, compared to 6,446 in the first quarter.

In contrast, “private home prices fell 4.7 per cent in the second quarter. It’s the 4th straight quarter decline but it is less than the 14.1 per cent sharp drop in the first quarter. (“Home prices dip 4.7%”, ST, Jul 24).

Historically, HDB and private property prices have more or less moved in close tandem with each other, most of the time. So, why are they moving in opposite direction now?

Well, the answer may lie in an altogether seemingly unrelated statistic – the number of graduates.

This year’s graduating cohort from the Nanyang Technological University – 8,000 students – is the largest ever (“8,000 students graduate from NTU this year“, CNA, Jul 23).

I estimate the total number of under-graduate and post-graduate students graduating in a year from all the universities and polytechnics to be about 40,000.

The admissions policy of the tertiary institutions reserves 20 per cent of first year admissions for foreigners. The balance 80 per cent goes to Singaporeans and PRs. I estimate that about 15 per cent go to PRs. So, the percentage for Singaporeans is probably about 65 per cent.

For graduate students, I estimate about 50 per cent are foreigners, and 15 per cent PRs. So, Singaporean graduate students make up probably about 35 per cent.

Some Singaporeans will leave the universities in their second year or later years for foreign universities, whereas probably very few foreigners leave for the basic reason that most foreigners are here on a tuition grant scheme, whereby they have to be bonded to work in Singapore for three years after graduation, and thus are financially less in a position to transfer to foreign universities compared to Singaporeans.

What this means in totality is that about 40 per cent of the entire student population are probably non-Singaporeans.

Since a foreign student on a tuition grant scheme is bonded to work for three years after graduation, he or she may soon become a PR, and eventually a citizen.

For housing, perhaps it makes more economic sense for him or her to buy a HDB flat instead of renting.

For example, renting just a room is about $450 to $650 per month, compared to a monthly repayment of only $400 for every $100,000 of a HDB concessionary loan for 30 years at 2.6 per cent.

So, PRs may try to marry a Singaporean quickly so that they can qualify for a new HDB flat with a HDB loan, or convert their bank loan to a HDB loan when they become citizens.

Of course, PRs with PR siblings, as well as married PRs, can also buy HDB resale flats with bank loans.

What all these mean may be that the demand for HDB flats and thus prices may go up.

Since HDB uses its “market subsidy” pricing policy to peg new HDB flat prices to resale prices, although nobody knows exactly what pricing formula is used, new HDB flat prices may consequently rise as well.

When the decision was made many years ago to have the “20% foreign students” policy, was any comprehensive study done on its implications on the demand and affordability of HDB flats?

Now let’s examine the question of demand and supply of HDB flats. After all, prices are a reflection of market supply and demand.

The HDB over-built about 16,000 5-room and larger flats which I understand took more than a decade to sell off.

Although the HDB is increasing its building of smaller flats, the fact that every BTO(Build-to-order) launch has been heavily over-subscribed is an indication that demand exceeds supply.

There is also the trend of more people down-grading to smaller flats to monetise their hone equity, which may also have fueled the demand for smaller flats.

With the record increase in the number of new PRs to 79,000 and new citizens to 21,000 last year, is it any wonder that HDB prices keep going up!

All these speculation could have been put to rest by making the relevant statistics available.

Is it not rather surprising that over the years, no MP has been able to ask a question in Parliament in such a way as to extract from the Government a simple answer as to the breakdown of the entire university population into foreigners, PRs and Singaporeans?

——

Subscribe
Notify of
0 Comments
Inline Feedbacks
View all comments
You May Also Like

Capital’s war against WikiLeaks

The following is an excerpt of an article published in Al Jazeera…

27家零售商联合声明 禁卖PMD予16岁以下青少年

27家个人代步工具(PMD)零售商昨日发出联合声明,限制16岁以下青少年购买有关设备。 他们在昨日的声明中指出,除非有成年人陪同,否则拒售个人代步工具予16岁以下青少年。他们也承诺只为已注册的个人代步工具提供服务,且不会进行任何个人代步工具电气系统的改装或增建。 他们表示,以上措施即时生效。 最近频频发生与个人代步工具相关的意外和火患事件,就如近日发生的电动踏板车骑士撞上女童事件、武吉巴督组屋一单位疑因个人代步工具充电引起火患,导致一男和一女婴被送院治疗,甚至闹出人命,引发了民众对此设备的关注。 零售商群体表示,虽然他们制定了规则和法规,且不断执法,却仍有不负责任的骑士严重滥用这些设备,甚至引起人们的警觉性。 “尽管部分人士的滥用已经超过我们的控制范围,但是有些注册或私营企业在减少不合规格的设备及不允许肇事者轻易获得相关设备上,也同样拥有共同责任。” 政府已强制所有上路的个人代步工具需符合UL2272防火标准的安全规格,且要求持有者进行强制性免费检查,且明年4月开始需每两年进行强制性检查。 交通部高级政务部长普杰立医生周一在国会上建议,若骑士或持有者继续滥用,或会禁止个人代步工具。他于周三接受CNA938采访时补充说,政府正考虑采取更多防范措施,包括要求骑士考取执照,并强制他们购买保险。 27家零售商在声明中重申,大多数骑士都有责任维护民众安全。 “我们将继续与社会并肩,反对滥用任何设备,无论是个人代步工具、脚踏车或其他设备。” “我们继续敦促所有骑士负起责任,并在共享空间关注到他人的存在。”

为何不公开社会关怀计划的批核准绳?

何不公布社会关怀计划下,发放短期援助金额的计算准则? 参考《海峡时报》今日报导,《社发部:更多家庭仰仗政府长期财务援助》,其中提到: “因为年迈、病痛或缺乏亲人支持的年长者人数增多,致使接受长期财务援助的家庭数量平稳增长。” 在2017财政年,有4千409家庭,接受社会与家庭发展部的长期援助,比起前年的4千387户更多。 数据也显示,去年接受长期援助的家庭,比起2013年的3千568户增加高达24巴仙。 社会关怀计划共发出1亿3100万元,在至今年3月前的12个月,共援助了7万9470人,比起2016财政年发放1亿3千万元,援助8万3333人稍有增加。 长期援助,也被称为公共辅助,乃针对因年迈、疾病、残疾而永久无法工作,并缺乏家庭支持者,协助他们应付生活困境。 一个单身家庭可以得到每月500元的补贴,而双人家庭则可得870元,也能在政府诊所的到免费看诊。 社工曾言,这类补贴从每月数百元起跳– 但,为何媒体和政府,都没有公布个体和家庭,所获得的实际财务援助金额,以及决定受惠者得到多少援助补贴的计算法和准绳? 既然长期援助可以开诚布公,那么中短期援助的呢? 在社发部的官网文告写道:“在2017年财政年,有2万7986家庭,以及6万4191个人,获得中短期援助,援助总额达到8千529万元。…

6 new cases of COVID-19 infection in S’pore; No locally transmitted case

As of Saturday noon (10 Jul), the Ministry of Health (MOH) has…