Can the market save itself?

Source : Today - 2 Mar 2009

I REFER to the report “A plea for survival” (Feb 27) about the Singapore Retailers Association (SRA) asking landlords to reduce rentals significantly to help retailers cope with the severe economic downturn. The report was an eye-opener, showing that while businesses are trying their best to survive these difficult times, some landlords are trying to earn as much as they can in the short-term.

The SRA is an organised body with many voices which will undoubtedly be heard. While it stands a good chance of gaining concessions for its members, the same cannot be said for individuals who want to rent homes here.

I understand that while trying to negotiate reasonable rentals in these difficult times, many tenants are faced with greedy agents and landlords who try to make as much money as they can in the short term.

After the norms for agency fees were abolished and the entire issue left to market forces, many agents seem to have decided that this is a good time to make unreasonable demands, more often than not on unsuspecting newcomers or those experiencing problems moving to a new neighbourhood quickly.

Meanwhile, the property organisations to which many of these agents claim to be accredited, appear to have adopted a blissfully unaware, hands-off approach to the issue.

A similar state of affairs is being faced by individuals buying or selling property as has been mentioned by several Today readers recently.

The state of affairs in the rental market is causing much misery to many people and has even forced some to seek business or employment opportunities abroad to avoid being fleeced.

This does not augur well for Singapore or for its image specially during these difficult times.

Considering that many free-market economies around the world have quickly introduced legislation to correct imbalances and undesirable situations, such blatant profiteering during these difficult times cannot simply be sorted out by market forces alone.

Perhaps new regulations and vigilance, as may be deemed appropriate by the relevant authorities, is needed swiftly to redress this situation and put an end to the unsavoury practices mentioned.

Raja Mitra