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.