Two shortcomings

Source : Straits Times – 22 Aug 2009

‘Public housing too correlated to private market, and HDB has not regulated supply in line with immigration and demographic trends.’

MR TREVOR TAN: ‘Thursday’s report, ‘Cash upfront for HDB resale flats doubles in a month’, suggests that the recent ramp-up in HDB prices during the most severe recession since Independence signals that the system requires a thorough review. Two failings come to mind – that public housing has become too correlated to the private market, and that HDB has not regulated its supply in line with immigration and demographic trends. As housing is the largest financial obligation for most Singaporeans, I fear this ramp-up in prices will create a batch of young couples who are too highly leveraged and tied to their mortgages. Come the next economic downturn, we will have a demographic group unable to deal with the loss of their jobs, as they will be laden with other obligations such as their children and ageing parents.’