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Roy Ngerng Questions PM Lee: Why are Singaporeans Paying Private Property Rent on Public Housing?

ROY NGERNG: Rebutting Singapore’s prime minister’s comments on housing – Lee Hsien Loong said:

(1) If someone buys a house with a 99-year lease when he gets married at 30 years old, and then retires 40 years later at 70, his house will still have 59 years of life left. That is enough for you to live in for free for the rest of your life, plus extra.

(2) At 99 years, it comes back to the Government. You have got 99 years of use out of it. The Government gets back the land, recycle and redevelop for somebody else. I think that is fair.

(3) It would not be fair if, at the end of 99 years, the Government takes back the flat and refunds its value to the occupant. I think that is the fundamental point which we have to understand because if we made it forever, or if we said at the end of 99 years, you give me back the house, I give you back your dollars. Then what about the years when you have been living in the house?


(A) He is conflating many issues. First, to tackle his points:

(1) He talks about people who live in their HDB flats for “free” for 59 years. By that logic, for people who buy freehold homes in Singapore and in other countries, are they then living in their homes for “free” for 100, 200 or 500 years, for as long as the freehold home stands? Lee Hsien Loong himself and his family bought Nassim Jade condominiums in the 1990s (at a discounted rate somemore). Does it mean that he and his future generations will get to stay in it for “free” for hundreds of years? In so, aren’t Singaporeans shortchanged if they can only live in their homes for “free” for 59 years?

(2) He said: “if we said at the end of 99 years, you give me back the house, I give you back your dollars. Then what about the years when you have been living in the house” What rubbish is this? Who said anything about living in a house for free?

(B) Now, let’s tackle the real issues and why he is conflating the housing issue.

(1) First and foremost, are HDB flats public or private properties? If they are public, they should be priced accordingly. This is the first point that Singaporeans are unhappy about – why do they have to pay high prices to pay for “public” flats? For the amount Singaporeans pay, they will be able to buy private homes in many other countries, even in some other high-income countries.

(2) Next, if Singaporeans have to return the flats after 99 years, and they also do not own the land, then why should Singaporeans pay for the land costs? The PAP started including land costs in flat prices in 1985, and land costs are estimated to account for 60% of the HDB flat prices. From 1985, the PAP started charging Singaporeans for land on HDB flats at market value, when the PAP had obtained the land at a fixed cheap rate based on the 1973 value. If so, why is the PAP charging Singaporeans market “private” value on the HDB flats, which are “public” flats, and not “private”? If land costs are removed, as they were in the 1960s, 1970s and early 1980s, flats would be truly “affordable”.

(3) Now, are Singaporeans asking the government to “give us back our dollar” and let us live for free? Whoever said that? Of course Singaporeans – and anyone actually – know that if we want to live somewhere, we need to either buy a place or rent one. This is sensible. Does he think we do not know this? What we also know is – because Singaporeans have to use our CPF pension monies to pay high prices for the flats, we therefore cannot save enough to retire. Now, if the government bought the land cheaply, and charges high flat prices even though Singaporeans do not own the land, which allows the government to earn high profits from the land for the government’s two investment firms to invest, then the question naturally is – why are Singaporeans losing their pension funds, to allow the government to accumulate profits at the two investment firms. Therefore, it is only sensible for the government to return the land costs (minus administrative charges) that Singaporeans have been forced to pay, at least for their retirement needs.

(C) Right now, Hsien Loong makes it sound like Singaporeans should be grateful because you get to buy flats and then live in them for “free” for 59 years, and then after that, we have to return it.

But clearly, Singaporeans are renting long-term and paying private property rents on public housing, no?

So, come clean. If the government wants to charge private rents, then take its hand out of the property market, implement minimum wage, raise wages, and ensure Singaporeans can earn enough to both buy private housing while earn adequate pension funds. Singapore’s GDP per capita is more than enough to ensure that can happen (see Denmark).

Otherwise, if the government wants to continue having its public housing program, then remove land cost, and charge public housing prices – like what Singapore’s first generation leaders did.

Do not tell Singaporeans it is a public housing program when at the same time, charge Singaporeans private prices.

And do not tell Singaporeans they own their homes, when they are only renting long-term.

So, come clean. Stop conflating.



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