Comments, opinions and an occasional ramble

The topic of public housing seems to be really hot these days. There was a news report about skyrocketing cash over valuation, and the Law Minister weighed in on how he thinks permanent residents are not to blame for skyrocketing prices. The Minister for National Development, Mah Bow Tan, seems to be reassuring Singaporeans pretty often these days that the prices of HDB flats will be affordable.

Public housing has always been at the heart of Singapore politics. Right from the early days of independence, the PAP has always used public housing as one of its key offensives against rival political parties, and public housing has always been to be a reliable ally at the ballot box. Food, jobs and shelter are the basic necessities of life, and if the ruling political party that cannot provide these adequately, it can almost be assured of decimation at the ballot box.

Whether public housing can continue as a reliable ally for the PAP in the next election remains to be seen. Skyrocketing HDB prices are causing lots of concerns, especially among the young and newly married. While Mah has constantly assured Singaporeans that public housing are, and will remain, affordable, my chats with peers indicates a general consensus that HDB flats are too expensive. There seems to be a disconnect between what the PAP thinks and what the average person on the street deems as affordable public housing.

I think the other political parties are going to have a field day at the next elections with the issue of increasingly costly public housing. If I don’t recall wrongly, Chiam See Tong said he intends to contest in a GRC in the next election, and it is mouthwatering to imagine him going to Tampines GRC, the turf of Mah, who, as a political rookie, lost to Chiam. Mah now seems to be one of the more politically vulnerable ministers with the on-going concerns about public housing prices.

I do think that the government should try and hold public housing prices steady. Right now, it seems that there’s a vicious cycle of greed going through the public housing open market. Sellers are trying their luck as to how cut throat they can be, and those who desperately need a roof over the head simply have no choice but to give in. Of late, I have been seeing fliers and posters by property agents advertising up to $50,000 cash over valuation in my area, Jurong West, by so-called “serious and immediate” buyers who are PRs or new citizens.

I do understand that these folks need a roof over the head too, and it is an urgent need since they’re already here in Singapore. The problem is that when such high cash over valuations are blatantly advertised and newspapers continually publish pieces of news on record home prices, many who own a HDB flat will think that this is the norm. As some people say, “If you tell a lie often enough, it becomes the truth”. So, the vicious cycle of greed will continually perpetuate as people believe the values of their homes will rise indefinitely.

And, most people should know the danger of believing that housing or stock prices will rise indefinitely: a bubble. I leave it to the economics experts to discuss this because I’m no expert on bubbles, but the rate of increase of public housing prices seems abnormal to me. I’m a little lucky, having bought my place at the tail end of the post SARS property market slump/start of the current property market boom. In a short span of less than three years, prices of flats in my area have almost doubled, and I doubt that salaries have increased that much (at least mine hasn’t).

Ok, enough rambling. What I really want to say is that I hope the government tries to keep public housing prices steady. I do think it’s time for some form of intervention in the public housing market, especially when elections could be round the corner. The reliable public housing political ally seems to have developed an Achilles heel, and it would be a good idea to do something about that heel.

The most common reasons cited by Singaporeans for not wanting to have more children are that they are too busy with building a career and that it is expensive to raise kids in Singapore. It is clear that economic realities of living in modern day Singapore makes couples think a lot more about having kids. However, the other costs of a low national fertility rate to the native Singaporean is much higher.

The main reason is simple. Low birth rates means that the government will continue to be more liberal in allowing foreigners to come here as PRs or citizens. And, unlike the times of our forefathers, Singapore today is unlikely to allow the naturalization the peasant, the construction worker or the cleaning lady. The Singapore government wants talents, or in the absence of talent, rich people.

The natural result is that native Singaporeans get squeezed in the job markets and the housing markets. Young Singaporeans like myself are now squeezed particularly hard in the housing markets because these PRs or new citizens come in either not knowing the local real estate market or having too much cash to burn, start offering high prices for property, driving property prices upwards. As for the employment landscape, that doesn’t need much explaining; it’s a demand and supply problem.

It’s not just the jobs and ever rising property prices. Later on, the kids of native Singaporeans are going to face fiercer competition for good Singaporean schools. Parents will have to end up forking more money for tuition classes and other enrichment classes to improve the odds of their kids getting into a good school. The PRs and new citizens will probably do the same thing too, so the only winners will be tuition teachers.

I am not against a liberal immigration policy, nor is this blog entry intended to engender any form of discrimination against PRs or new citizens. In fact, I like a more diverse Singapore, but the speed at which we are allowing immigration in order to counter low birth rates is certainly detrimental to native Singaporeans, especially those on the lower rungs of the education ladder or the workforce, and the best solution is to bring Singapore’s fertility levels back up.

So, if you want your kid to have a better chance of going into a good school in future, to have more affordable HDB flats and to get good jobs, do him or her a favour by giving your kid a few more brothers and sisters.

The escalating prices of HDB flats is in the spotlight once again with MM Lee’s remarks about HDB flats increasing in price since independence, and that the upward climb will continue into the future.

The Singapore government, from time to time, uses the rising prices of HDB flats as an indicator of the rising affluence of Singaporeans. Most Singaporeans own at least one piece of property, the HDB flat, and with the increasing prices of HDB flats, the implication is that Singaporeans are becoming more and more affluent. I personally think the rising prices of HDB flats across the board is merely an illusion of wealth for the owner.

The reason is pretty simple. The flat is worthless in actual monetary terms unless it is exchanged for cash, i.e. sold. Paper value isn’t exactly real money. The best part is that, most Singaporeans only own ONE HDB flat. If they sell their HDB flat, they’ll need another one to stay in. If the price of HDB flats keeps climbing upwards, even if you make a profit from selling, because of the fact that you have to buy another flat to get a roof over the head, most of that profit will vaporise because you have to pay a high price for a new flat.

If people keep on believing that their flats are worth lots of money, the logical result is that there will be an upward spiral in flat prices. How sustainable this upward spiral is, that’s anybody’s guess. With an upward spiral of flat prices, the biggest winners are not the people who own HDB flats, but the government and property agents.

I personally do not see a solution for this upward spiral of prices, other than trying to contain the speed of the increase. The reason is because it is politically suicidal to force down the prices of HDB flats after years of telling Singaporeans that their flats are valuable assets. Furthermore, with all the upgrading schemes that’s going on that are being marketed as flat value enhancers, even an old HDB flat will not be cheap. Cheap public housing is not possible in Singapore anymore. This is why the ministers are very judicious in their choice of words these days, describing HDB flats as “affordable”.

If you own one HDB flat that’s worth a few hundred thousand dollars, you are not wealthy at all, especially when most flats are around the same price. You are only wealthy if you can make someone cough out 600 to 700 thousand dollars for your flat and then buy one for 300 to 400 thousand dollars. What are the odds of that happening?

I first came across this story about 22 people caught in Malaysia for indulging in a sex orgy on the Straits Times’ website.

The headline of the Straits Times version of the story is “3 women caught at sex orgy”. After I read the story, I found out that the three women were Malaysian, and they were caught for prostituting themselves to 19 Bangladeshi men in a sex orgy. I got annoyed after learning the whole story because I couldn’t understand why the focus was on the women. The headline was plainly sexist.

Later, I realised the story was attributed to The Star, a Malaysian newspaper. So, I went to search for the original story that appeared on The Star, and the headline, “Three women caught at sex orgy with 19 foreigners”, was a little better than the Straits Times, although it was still sexist because the headline explicitly mentioned the word ‘women’ but not ‘men’.

I don’t understand why the focus of the story had to be on the women. The Bangladeshi men are equally guilty of committing the offence. Why can’t the headline be gender neutral, such as “22 people caught for sex orgy”?. The fact of the matter is that there were 22 people involved in the act, so why did the papers decide to highlight the role of the women in the offence?

In fact, the newspapers should highlight the alleged pimp and mastermind of the orgy, a 56 year-old man. Sheesh. I can’t speak for the Malaysian papers, but I think the Straits Times editors should have had more sense to change the headline for re-publication.

While I’ve been ranting about the Straits Times pretty often of late, being the most decent English newspaper on this island, I have no choice but to read it for local news, and this piece of news about a man jailed for pitching and living in illegal tent was rather disturbing to me.

I do not know the complete facts of the case, but assuming the newspaper report is accurate, this man pitched a canvas tent at East Coast Park in 2007 without a valid license, and he lived there for a month before being discovered and apprehended by park rangers who presumably handed him over to the police, and then the attorney-general’s chambers decided to proceed with the case, resulting in the fine which became a 4 day jail term because of inability to pay the fine.

The reason for this man living in a tent is apparently homelessness and unemployment. And in that month he lived outdoors, he claimed he seldom ate, subsisting on food that friends would bring from time to time.

I believe these information should have been given to the police, who would have in turn passed it on to the AGC. While I understand that this man has indeed broken a law and legal prosecution is completely justified, surely some empathy could have been shown in deciding whether to charge this person. The justice system worked flawlessly in this case, but what this person needs is not a fine nor jailing; what he needs is social assistance to deal with the source of his transgression of the law. The justice system is not the antidote to this problem.

This is not the way to build a more inclusive and gracious society. And yes, a more inclusive and gracious society needs a greater supply of empathy, and of course, the participation of the justice system too.

It’s a sad story to read.