REACH (Telegram) 15 - What are your views on the reduction in the loan-to-value (LTV) limit for HDB loans and the enhanced CPF Housing Grant? Are you sufficiently assured that such measures will help public housing remain affordable and accessible for Singaporeans?

(SK)

21 Aug 2024 (10am - 7pm)

REACH (Telegram)

REACH Singapore, [21/8/2024 9:45 AM]

Dear contributors,

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Megan 😊

REACH Singapore, [21/8/2024 10:01 AM]

📢 Topic 📢

On August 20, Minister for National Development Mr Desmond Lee said the move to tighten the maximum loan that home buyers can take from the Housing and Development Board (HDB) was meant to encourage prudent borrowing and dampen demand at the higher end of the HDB resale market.

💬 What are your views on the reduction in the loan-to-value (LTV) limit for HDB loans and the enhanced CPF Housing Grant? Are you sufficiently assured that such measures will help public housing remain affordable and accessible for Singaporeans?

📌 Loan-to-value (LTV) Limit Reduction

As of 20 August, the maximum loan-to-value (LTV) limit for HDB loans will be lowered to 75 per cent, meaning buyers will be able to borrow up to 75 percent of the flat's value, down from the previous 80 percent.

The adjustment brings the HDB loan limit in line with mortgages offered by financial institutions, which also cap loans at 75% of the property's value.

📌 Enhanced CPF Housing Grant (EHG) Increase

Starting from 20 August, eligible families can receive up to $120,000 (up from $80,000), and singles can receive up to $60,000 (up from $40,000) for their first new or resale flat purchase. 

This increase aims to make homeownership more accessible for lower-income groups, especially with the upcoming classification of Prime, Plus, and Standard BTO flats.

Minister Lee highlighted that about 85% of first-time buyers, or over 13,000 households annually, are expected to benefit from this enhanced support.

📌 Market Perception and Affordability Concerns

Minister Lee noted that million-dollar flats, which make up about 2% of resale transactions, were mostly larger units in prime locations, while high-priced smaller flats were typically centrally located with excellent amenities. 

Despite their low percentage, these transactions have sparked concerns about overall affordability, leading to increased price expectations among sellers and anxiety among buyers. He said that if not careful, such market dynamics can cause the resale market to run ahead of economic fundamentals and “cause a bubble”.

Minister Lee also said that the changes are meant to encourage buyers to be prudent in their flat purchase in an unpredictable economic climate.

👉[ST]https://www.straitstimes.com/singapore/housing/vast-majority-of-hdb-buyers-not-affected-by-tighter-loan-to-value-limit-desmond-lee 

👉[CNA]https://www.channelnewsasia.com/singapore/hdb-loan-value-limit-cooling-measure-borrowing-market-demand-4556096 

👉[CNA]https://www.channelnewsasia.com/singapore/hdb-property-cooling-first-time-buyers-cpf-housing-grant-loan-value-limit-lowered-4554726

----

REACH Singapore, [21/8/2024 11:01 AM]

REACH Singapore, [21/8/2024 11:01 AM]

Dear Contributors,

We want to HEAR MORE from you!

💬 What are your views on the reduction in the loan-to-value (LTV) limit for HDB loans and the enhanced CPF Housing Grant? Are you sufficiently assured that such measures will help public housing remain affordable and accessible for Singaporeans?

We have had good feedback from this group, and we hope that we can keep the discussion robust and active!

Thank you.

Megan 😊

REACH Singapore, [21/8/2024 11:04 AM]

[ Poll : 1. How do you feel about the recent reduction in the loan-to-value (LTV) limit for HDB loans from 80% to 75%? ]

- Supportive

- Not Supportive (please share your views in the chats below)

REACH Singapore, [21/8/2024 11:07 AM]

[ Poll : 2. Are you satisfied with the increase in Enhanced CPF Housing Grant (EHG) for first-time buyers? ]

- Yes

- No (please share your views in the chats below)

REACH Singapore, [21/8/2024 11:09 AM]

[ Poll : 3. What other concerns do you have regarding the current HDB resale market? ]

- Rising prices and affordability

- Potential Market Bubble

- Nil, I am confident in the cooling measures implemented

- Others (please share your views in the chats below)

Hanny, [21/8/2024 11:46 AM]

I hope gov made the decision based on the data it has.

I mean gov ha looked at the buyers profile before deciding that new limit would be effective.

G, [21/8/2024 11:57 AM]

With the rules easing for singles to buy BTOs, how do these address the increased demand?

How has HDB used immigration numbers to forecast demand to ensure bubbles are not created?

A typical single income family could comfortably afford a typical 4 room HDB flat without requiring grants and/or 30 year mortgages in the 1980s. What steps are HDB doing to bring HDB flat affordability back to what it was in the 1980s?

Hanny, [21/8/2024 12:00 PM]

I have not checked DOS website yet. I believe there is a statistic on affordability. This is usually tied to income.

G, [21/8/2024 12:03 PM]

This income statistic, does it reveal whether it's a single or multi income household?

Hanny, [21/8/2024 12:12 PM]

Income should be by household.

Hanny, [21/8/2024 12:17 PM]

Single or multi income is a choice made by every family. Every family has its own priorities. There are pro n con for every decision. No right or wrong. So, stats by household should be the most reasonable.

REACH Singapore, [21/8/2024 1:02 PM]

[ Poll : 1. How do you feel about the recent reduction in the loan-to-value (LTV) limit for HDB loans from 80% to 75%? ]

- Supportive

- Not Supportive (please share your views in the chats below)

REACH Singapore, [21/8/2024 1:02 PM]

[ Poll : 2. Are you satisfied with the increase in Enhanced CPF Housing Grant (EHG) for first-time buyers? ]

- Yes

- No (please share your views in the chats below)

REACH Singapore, [21/8/2024 1:03 PM]

[ Poll : 3. What other concerns do you have regarding the current HDB resale market? ]

- Rising prices and affordability

- Potential Market Bubble

- Nil, I am confident in the cooling measures implemented

- Others (please share your views in the chats below)

REACH Singapore, [21/8/2024 1:03 PM]

REACH Singapore, [21/8/2024 1:03 PM]

Dear Contributors,

Please take a moment to participate in our polls 📊and share your opinion 💭. The poll questions are pinned for easy reference, and your vote is anonymous.

We look forward to hearing your thoughts on today’s topic!

Thank you.

Megan

Nicholas, [21/8/2024 1:11 PM]

On the one hand there's a lower LTV cooling measure, while on the other hand there are higher grants and HDBs in more desirable locations. The measures seem to work against each other since one side lowers prices while the other side increases prices.

Dr. Goh, [21/8/2024 2:31 PM]

I've always been consistent on this topic - you want HDB prices to match salaries and cost of living so people don't struggle so much. In 2011 the prices were insane. After that despite having own place I still advocate for prices to drop. Now same, prices cannot be too high otherwise you end up with a whole generation of beggars after retirement.

Gahmen already gave so many good jobs to enclaves, all the more it should keep prices reasonable, to the extent that even stint workers can afford HDB 4 room, otherwise all the local born grab drivers will suffer. Is gahmen going to pay for all the expenses as a result of enclave based discriminatory hiring? The numbers will be telling that's why MOM refused to share.

REACH Singapore, [21/8/2024 3:00 PM]

[ Poll : 1. How do you feel about the recent reduction in the loan-to-value (LTV) limit for HDB loans from 80% to 75%? ]

- Supportive

- Not Supportive (please share your views in the chats below)

REACH Singapore, [21/8/2024 3:00 PM]

[ Poll : 2. Are you satisfied with the increase in Enhanced CPF Housing Grant (EHG) for first-time buyers? ]

- Yes

- No (please share your views in the chats below)

REACH Singapore, [21/8/2024 3:01 PM]

[ Poll : 3. What other concerns do you have regarding the current HDB resale market? ]

- Rising prices and affordability

- Potential Market Bubble

- Nil, I am confident in the cooling measures implemented

- Others (please share your views in the chats below)

REACH Singapore, [21/8/2024 3:01 PM]

Dear Contributors,

Please take a moment to participate in our polls 📊and share your opinion 💭. The poll questions are pinned for easy reference, and your vote is anonymous.

We look forward to hearing your thoughts on today’s topic!

Thank you.

Megan

LCL (Danny 心), [21/8/2024 3:01 PM]

*Tampering million dollar flat (or ensuring HDB flats affordability)*

1. To curb rising HDB flat prices running above 1 million, and fuelling other HDB flat price to rise in tandem, a simple economic solution will be able to handle it.

---

LCL (Danny 心), [21/8/2024 3:01 PM]

*Application of Economic principle of Demand and Supply*

1. Prices are determine by Demand and Supply.

This is best illustrated by a simple economic chart.

Price is the y-coordinate.

Output is the x-coordinate.

Supply curve is drawn from bottom left to top right.

Demand curve is drawn from top left to bottom right.

Supply curve and Demand curve intersect - and will determine the Price of the HDB flats.

2. 2 ways to reduce HDB flat price :-

a. Shift demand curve from top right to bottom left (ie.. reduce demand) - HDB price fall.

b. Shift supply curve from left to the right (ie. increase supply) - HDB price fall.

3. A closer look at the new Government housing policy is an attempt to apply this economic principle to dampen the runaway HDB resale prices while ensuring affordability of new BTO flats to 1st time HDB flat owners to help the lower and middle income group to own a HDB flat.

----

LCL (Danny 心), [21/8/2024 3:02 PM]

*New HDB flat policies to tackle rising price while ensuring affordability*

1. Notice that those million dollars flats are mainly big flats eg. 3-gen flats, masionette, DBSS flat or 5-room flats.

No matter how high the household income is per month, the household will still need to borrow loans either from HDB/CPF or from banks.

Many are not possible to pay say $250,000 (25% of $1 million) cash upfront for a resale flat.

Hence reducing LTV (loan-to-value) from 80% to 75% - that means buyers abilities or willingness to fork out $250,000 upfront instead of $200,000 will be reduced.

This will make lesser buyers to want to pay $1 million flats - as buyers are unable to borrow more loans to pay for the flats dampening demand.

This is an attempt to manipulate with the Demand side of the Demand-Supply curve.

This dampen the Demand side of the Demand-Supply curve - shifting demand curve from top right to bottom left (ie.. reduce demand) - HDB price fall.

2. At the same time, HDB are ramping up higher supply of HDB flats.

This is an attempt to manipulate with the Supply side of the Demand-Supply curve.

This will be shifting the supply curve from left to the right (ie. increase supply) - HDB price fall.

3. However, the Government noted that overall, the prices of the HDB flats are creeping up as the land price premium go up, inflation go up and the positive economic conditions go up.

This means 1st time HDB flats owners will be facing difficulties to own a flat for marriage and raise a family.

Hence, increasing housing grants to make HDB flats affordable will be a good move to ensure 1st HDB flats owners can own a flat to raise a family and bear babies.

4. Noted that housing grants help HDB owners to be able to afford owning houses, but not a profit for HDB owners.

If HDB owners eventually sell the flats after MOP, the housing grants will need to be given back to the Government.

(But having say so, thinking aloud..... Government fiscal budget pocket are pretty deep.......  as Government are able to finance many initiatives to help the people e.g, increasing housing grants, retrenchment temporary support grants, GST and CDC vouchers........ Hmmm)

I will be supportive of all these support grants to help the people --- as long as the Government don't dig into our reserves to finance all these support grants).

Our Sovereign Reserves must be preserve and grow to ensure our future generations are protected.

Our Reserves should only be used for emergency crisis or rainy days. And upon the crisis is over, there must be attempt to recover and ensure the Reserves will continue to grow.

Singapore has no natural reserves or resources.

The only resources we have are our people/human capital and our Sovereign Reserves (that we painfully save and build up).

Hence our Sovereign Reserves must be "Our Sacred Cow" - and must be carefully and prudently preserve, keep and grow.

REACH Singapore, [21/8/2024 3:20 PM]

📢 Topic 📢

LCL (Danny 心), [21/8/2024 3:28 PM]

*Is it reasonable to expect prices to remain at 1960s or 1970s - as Economy grow and progress*

1. Many man-in-the-street wonder, why can't the prices of HDB flats or food prices can't be kept at 1960s or 1970s - say $60,000 or $120,000 - can afford a 4 room or 5 room flats.

Not the current $350,000 to $500,000 flats.

2. The answer is, no Countries in the World when moving from undeveloped, underdeveloped, developing to Developed Economies --- will have a stagnant prices whereby the income rises and the economy progress butwill still have housing prices stick at 1960s or 1970s - while the population income increases.

It defy Economic logics.

(That is, it goes against nature).

(An analogy, can a human faces, bodies and organ remain to be as young and as fresh like a 10 years old, as we grow old into 50 years old?

Of course not, because it defy logic and nature).

3. Let us examine this phenonmenon why it is not possible in economic terms:-

a. Population income grow and increase by a few % every year.

During 1960s, 1970s, our salaries is $1,000 (cannot recall, assume $1,000) - we can buy noodles at $0.50cents. Previously, only husband work, wife take care of house care.

But now, our household median salaries base on yearly % increase (plus many other factors like high value added jobs, new technologies and machineries, higher productivity) --- it is now $10,869 per month (10 times more).

1960-1970 HDB finance

For $60,000 flats, taking a HDB loan for 20 years, assume an interest rate of 2.60%, HDB owners will need only to pay $256.50 per month

Take home pay $1,000 - $256.50 = $743.50 - to survive for daily expenses after paying housing loan

2024 HDB finance

For $500,000 BTO flats, taking a HDB loan for 20 years, assume an interest rate of 2.60%, HDB owners will need to pay $2,137.50.

Take home pay $10,869 - $2,137.50 = $8,731.50 - to survive for daily expenses after paying housing loan

So household income - vis-a-vis affordability of housing loan - comparing 1960s-1970s to 2024 --- our population are not worst off.

Jun Ming, [21/8/2024 3:32 PM]

Is it reasonable to expect price in 1960s or 70s

Let me ask you if the price and the growth of salary or economy increase proportionally. Are they using same effort to get the same thing

LCL (Danny 心), [21/8/2024 3:33 PM]

Sorry don't understand the question.

LCL (Danny 心), [21/8/2024 3:34 PM]

Last time people are coolies.

Now people use computer.

LCL (Danny 心), [21/8/2024 3:39 PM]

b. Inflation - as population income increases, inflation (goods and services prices) will also increase.

In Singapore, 2 to 2.5% inflation is a norm.

Hence food prices do increase from 0.50cents a noodle in 1960s to now $4 - is not unexpected as our income increase 10 times ($1,000 to $10,000 per household income).

c. Production costs increase.

As raw material prices increase, workers income increase, of course manufacturing costs also increase.

Land developers need also to survive and thrive, will also increase price - as more business demand more lands to build offices and factories.

d. Economy grows, Economy sophistication grows, taxes rises to cope with increase sophistication.

e. Technology advancement, drive up cost in investment and infrastructure investment.

Hence not possible to compare 1960s-70s prices to 2024.

Economy grows. We cannot expect prices to be in 1960s as our Economy grow phenomenally in 2024 and expect our salaries to be $1,000?

Likewise, human age and grows. We cannot expect our bodies to remain young as we aged.

Hence it defy Economic logic, defy Law of Nature..

Jun Ming, [21/8/2024 3:44 PM]

Like... In terms of salary how much time on average to earn 1 square feet Vs in 1970

LCL (Danny 心), [21/8/2024 3:46 PM]

1. Eg.1960s people carry goods from tongkang at harbour to warehouse using bullock cart $1,000 per month

2. 2024 people use computers in command centre, autonomous driverless truck to unload goods from container ships to warehouse earning $10,000 a month

3. So difficult to assign "proportionality" of salary increase from 1960s to 2024.

It is compounded by :-

a. Human skillsets and training

b. Technology investment

c. Business willingness to pay in terms of productivity, ability to engage skill workers, labour market demand, profitability

d. Consumer demand - ability to sell at what market price

Jun Ming, [21/8/2024 3:46 PM]

Like say someone 3000/ month in today's rate before cpf detection how long does she need to work to get a same size house in terms of area compared back into the 70s

LCL (Danny 心), [21/8/2024 3:47 PM]

I prefer my current house.

In 1970, I live in a rundown house.

LCL (Danny 心), [21/8/2024 3:47 PM]

I prefer my current house.

In 1970, I live in a rundown house.

Jun Ming, [21/8/2024 3:57 PM]

So in 1970 earning 400/month  35000/400 =87.5 months 

Now in 2024 earning 3000/month and  700000/3000 = 233 months

Jun Ming, [21/8/2024 3:57 PM]

You see the difference

Jun Ming, [21/8/2024 3:58 PM]

Even you earn 5k you still need to pay 140 months where the house is so much smaller compared to big old flats

Jun Ming, [21/8/2024 4:01 PM]

I hope that explains my point

Jun Ming, [21/8/2024 4:02 PM]

That's why I am thinking if we should actually reduce our population to free more land for bigger houses

REACH Singapore, [21/8/2024 4:03 PM]

📢 Topic 📢

LCL (Danny 心), [21/8/2024 4:03 PM]

Now bto flat don't cost $700,000 unless you are saying resale flats

LCL (Danny 心), [21/8/2024 4:04 PM]

Also reducing population means our domestic market smaller, economy become worst off.

Not enough people to protect our country.

Easily eaten up and overrun.

LCL (Danny 心), [21/8/2024 4:05 PM]

5 room flat $500,000 still available.

LCL (Danny 心), [21/8/2024 4:06 PM]

If salary is $3,000, advisable to buy 4 room flat or smaller.

Jun Ming, [21/8/2024 4:08 PM]

Depends on location also but usually 500000 to 700000

LCL (Danny 心), [21/8/2024 4:09 PM]

Choose something we can afford.

Jun Ming, [21/8/2024 4:09 PM]

Where resale 4 room flat is bigger than new bto 5 room flat and extc condo lol

Jun Ming, [21/8/2024 4:11 PM]

Imagine you buy executive condo and your relatives say wah so expensive and small. My 4 room flat is so much bigger and cheaper than yours. How would you feel

LCL (Danny 心), [21/8/2024 4:13 PM]

I don't look at such gimmick stuff.

A plain old HDB flat good enough for me.

Jun Ming, [21/8/2024 4:14 PM]

What I meant is the price and the size must match mah. Cannot be in the 70s this price can buy a big house and now after accounting inflation the same price cannot buy the same size house

Jun Ming, [21/8/2024 4:15 PM]

If  the price is equal after accounting inflation no one will complain

LCL (Danny 心), [21/8/2024 4:15 PM]

I just take the house that match my needs.

I don't go around comparing how nice or how big the house is.

Jun Ming, [21/8/2024 4:16 PM]

Like I compare between price /m square

Jun Ming, [21/8/2024 4:16 PM]

If the house is smaller and I am satisfied the price should be much cheaper

LCL (Danny 心), [21/8/2024 4:18 PM]

All my siblings live in private properties very big.

My close friend live in private condos.

I happily choose a HDB flat as it match my needs.

Why need to compare?

Jun Ming, [21/8/2024 4:18 PM]

You don't understand my point

LCL (Danny 心), [21/8/2024 4:19 PM]

I understand your points.

Except I don't want to go down to the Nitty gritty to count little little things.

Just be happy.

LCL (Danny 心), [21/8/2024 4:20 PM]

I thought Bhutan happy?

Then go for nitty gritty not happy.

Jun Ming, [21/8/2024 4:21 PM]

My point is in the 80s the same x/square meter now by right should be x(inflation)/ square meter. But now is the price is bigger than x(inflation)/square meter

Jun Ming, [21/8/2024 4:22 PM]

Bhutan no need so much money to have a shelter mah

Jun Ming, [21/8/2024 4:22 PM]

For Singaporean welfare you know

LCL (Danny 心), [21/8/2024 4:22 PM]

Well, come back to 初心。

Just be happy.

Jun Ming, [21/8/2024 4:24 PM]

I think this is something gov needs to address lol. I know you rich but think of others who are struggling

LCL (Danny 心), [21/8/2024 4:25 PM]

I thought government give you more grants to buy HDB flat?

Jun Ming, [21/8/2024 4:26 PM]

Yup but does that cover inflation and probably there's also grants during lky era

Jun Ming, [21/8/2024 4:27 PM]

If not people will continue to stay in the old run down village and not willing to move

LCL (Danny 心), [21/8/2024 4:27 PM]

You must be realistic.

Cannot expect big house when cannot afford.

Jun Ming, [21/8/2024 4:29 PM]

I just doing a comparison between era after accounting inflation

LCL (Danny 心), [21/8/2024 4:30 PM]

Consider buying Johor house.

Very big and cheap.

Singapore not enough lands.

Jun Ming, [21/8/2024 4:31 PM]

I am considering it... If I got the ability definitely will

LCL (Danny 心), [21/8/2024 4:31 PM]

Got RTS, can easily move in and out.

Jun Ming, [21/8/2024 4:36 PM]

Yup most probably more Singaporean will buy Malaysia housing unless Singapore housing price dropped

LCL (Danny 心), [21/8/2024 4:37 PM]

There will be in and out.

More foreigners want to come in.

Some Singaporeans want bigger house and cheaper prices.

Jun Ming, [21/8/2024 4:39 PM]

Then Singapore will be more of a hotel than home

LCL (Danny 心), [21/8/2024 4:39 PM]

Singapore land will always be a premium because demand will always go up because our economy will always grow.

Jun Ming, [21/8/2024 4:41 PM]

Which means hotel lor attract more investment then our own people kena kick out lor

LCL (Danny 心), [21/8/2024 4:42 PM]

Many Singaporeans can bear with the constraints and stay.

Your expectations cannot be fulfilled.

So can't be helped.

G, [21/8/2024 5:01 PM]

Stats should have granularity to how many members of the household are contributing to the income. 

The impact on household affordability can vary vastly. Single income household earning median wage being able to afford typical 4 room HDB flat without requiring grants and/or 30 year mortgages is very different from having dual income (each earning half the median income). 

The spouse that is not working in a single income household has the capacity to manage the household (chores, taking care of dependants etc). In dual income households, both spouses need to work and won't have as much capacity to manage the household and dependant, thus requiring a household manager (in-laws, FDW etc?), and or the requirement for child care services, thus causing overall household expenses to increase. Thus impacting things they can afford.

REACH Singapore, [21/8/2024 5:01 PM]

[ Poll : 1. How do you feel about the recent reduction in the loan-to-value (LTV) limit for HDB loans from 80% to 75%? ]

- Supportive

- Not Supportive (please share your views in the chats below)

REACH Singapore, [21/8/2024 5:01 PM]

[ Poll : 2. Are you satisfied with the increase in Enhanced CPF Housing Grant (EHG) for first-time buyers? ]

- Yes

- No (please share your views in the chats below)

REACH Singapore, [21/8/2024 5:01 PM]

[ Poll : 3. What other concerns do you have regarding the current HDB resale market? ]

- Rising prices and affordability

- Potential Market Bubble

- Nil, I am confident in the cooling measures implemented

- Others (please share your views in the chats below)

REACH Singapore, [21/8/2024 5:01 PM]

Dear Contributors,

Please take a moment to participate in our polls 📊and share your opinion 💭. The poll questions are pinned for easy reference, and your vote is anonymous.

We look forward to hearing your thoughts on today’s topic!

Thank you.

Megan

G, [21/8/2024 5:02 PM]

HDB's metrics is thus not good enough if they only look at household income without examining how many members of that household are working for income

G, [21/8/2024 5:09 PM]

What's the trend of median incomes of first time HDB buyers? 

It will also be more useful to use this number to gauge affordability than Singapore's median income

Adam, [21/8/2024 5:11 PM]

Gov will not give individual income. They will skew statistics by putting household income

G, [21/8/2024 5:12 PM]

Then this is mischievous

Adam, [21/8/2024 5:13 PM]

Looks like the expectation of singaporean society is dual income household

Adam, [21/8/2024 5:14 PM]

Lol i hate how some vouchers is given to whole household instead of individual

Adam, [21/8/2024 5:14 PM]

Is family poor and all have to live under one roof then how?

G, [21/8/2024 5:15 PM]

Your comparison is incomplete without showing floor areas / flat size

Adam, [21/8/2024 5:15 PM]

I think sg needs a land value tax. If your lifestyle is not making efficient use of our precious land reserves needs to be disincsntivised

G, [21/8/2024 5:18 PM]

Which is why it's mischievous to just state household income.

Because flats were affordable by single income household earning median salary in the 80s. Can afford 4 room HDB flat without grants and or 30 year mortgages

But now mostly dual income

Adam, [21/8/2024 5:19 PM]

At this point my household income is my parents + me working

Adam, [21/8/2024 5:19 PM]

Gonna be triple income household

G, [21/8/2024 5:24 PM]

Yes.. That's why it's also important to see the trend of first time buyers' median incomes vs BTO prices, and not Singapore median income. 

This will give a more accurate picture of affordability

Adam, [21/8/2024 5:25 PM]

Actually this is also anoter big problem. The demographics of people who buy bto, and those who wanna buy bto but cannot because of gov policy

Adam, [21/8/2024 5:25 PM]

Like how can we plot data of singles who want to buy bto?

Adam, [21/8/2024 5:26 PM]

Actually, what gov needs to plot is income over time of people who get bto and their age

Adam, [21/8/2024 5:27 PM]

You cannot treat some couple who get bto fresh out of uni with 5k salary each the same as a older couple

Adam, [21/8/2024 5:28 PM]

Then if single buy bto at 35, they already lose out to their peers who rushed into marraige a decade earlier. Assuming they are within the income cap too

Adam, [21/8/2024 5:29 PM]

Actually should we even talk about the social issues that pressure couples into getting bto?

Adam, [21/8/2024 5:29 PM]

Does the gov acknowledge it?

G, [21/8/2024 5:29 PM]

This comparison also incomplete without comparing the purchasing power of the dollar value of whatever you state as "take home pay"

Furthermore, in the past, CPF wasn't allowed to be used for HDB financing. Means single income households could afford HDBs using cash payment only, and the household could still get by. 

Now the vast majority are using CPF to finance their mortgages, and the purchasing power of their cash has gone down compared to the 80s

G, [21/8/2024 5:49 PM]

It's a simple question that you have convoluted

Question was about salary. Dollar quantum by month but you have to add in extra parameters to confuse

LCL (Danny 心), [21/8/2024 5:51 PM]

I have been using cpf to pay my housing for 20 years and I now fully pay up.

G, [21/8/2024 5:51 PM]

Using outlier example when people talk about trend

G, [21/8/2024 5:52 PM]

Will it make the govt look bad?

LCL (Danny 心), [21/8/2024 5:52 PM]

1968 CPF can be used to pay HDB flat

LCL (Danny 心), [21/8/2024 5:53 PM]

government introduced the Central Provident Fund (CPF) (Amendment) Act in September 1968, allowing CPF savings to be used for the downpayment and monthly instalments for new flats purchased from HDB.

LCL (Danny 心), [21/8/2024 5:53 PM]

Source :- google.

LCL (Danny 心), [21/8/2024 5:56 PM]

My nephew and niece can afford to finance their new HDB flats - because they choose 4 rooms flat with grants and can afford.

No need cash layout.

Unless people want big big house, cannot afford yet die die want - of course cannot afford lah.

G, [21/8/2024 5:57 PM]

Are they single income or dual income households?

LCL (Danny 心), [21/8/2024 5:58 PM]

Dual income.

Close to household median income.

Live comfortably because they are realistic.

G, [21/8/2024 5:58 PM]

If they are single household income, can still afford what they chose?

LCL (Danny 心), [21/8/2024 5:59 PM]

Then choose a 3 r or 2 r type

G, [21/8/2024 5:59 PM]

Answer the question: can they still afford the 4 room flat they chose if they only had 1 income

LCL (Danny 心), [21/8/2024 5:59 PM]

Oh lazy to answer rude questions.

LCL (Danny 心), [21/8/2024 6:01 PM]

I and my siblings single income.

We have fully paid up our houses.

G, [21/8/2024 6:01 PM]

What a kop out. 

It's with a high probability that they cannot afford the 4 rm flat if it were just based on 1 income now. 

But in the 80s, single income on median salary can afford 4 rm flat

REACH Singapore, [21/8/2024 6:01 PM]

📢 Topic 📢

G, [21/8/2024 6:02 PM]

When did you buy your houses?

LCL (Danny 心), [21/8/2024 6:02 PM]

That's why you don't understand simple English.

If cannot afford buy 3r or 2r.

G, [21/8/2024 6:03 PM]

You don't understand affordability comparison. 

How to gauge affordability over the years if you mix and match flat times on whims?

LCL (Danny 心), [21/8/2024 6:04 PM]

I know of people single income.

1,500 choose a 1 room flat.

3 person in a household.

LCL (Danny 心), [21/8/2024 6:04 PM]

Why need 5 room and 4 room if cannot afford?

G, [21/8/2024 6:04 PM]

So what, in future, tell Singaporeans: too bad, you can afford 1 rm flat what, complain about affordability for what?

G, [21/8/2024 6:05 PM]

Nope. Ask u to compare 4rm flat affordability in 80s vs today. Since 4rm flats are the most produced flat types in SG

LCL (Danny 心), [21/8/2024 6:05 PM]

If you can't afford, get what you can afford.

There are many people who are doing well.

LCL (Danny 心), [21/8/2024 6:06 PM]

If you can't do well, ask yourself why so many people can and yet you cannot?

G, [21/8/2024 6:06 PM]

So means to say, single income household today can only afford 3rm and below la.. but in the 80s, single income household can afford 4rm flat?

LCL (Danny 心), [21/8/2024 6:07 PM]

Yawn...

G, [21/8/2024 6:08 PM]

Preaching that people should only buy what they can afford, when people are raising concerns about affordability is fine gaslighting

CTO, [21/8/2024 6:08 PM]

The goalpost had shifted again liao……..

G, [21/8/2024 6:08 PM]

How big are your houses and when did you buy them?

LCL (Danny 心), [21/8/2024 6:15 PM]

Which income groups you belong to?

G, [21/8/2024 6:16 PM]

Why does this information matter?

LCL (Danny 心), [21/8/2024 6:16 PM]

Oh so your question also irrelevant.

Hanny, [21/8/2024 6:17 PM]

For those who yearn to have more land by reducing work force, take a look at Japan. Lots of cheap houses. Depressing economy.

LCL (Danny 心), [21/8/2024 6:17 PM]

Exactly.

Hanny, [21/8/2024 6:17 PM]

The gov should concentrate on increasing income for everyone.

Hanny, [21/8/2024 6:17 PM]

This is a better approach.

G, [21/8/2024 6:17 PM]

Why? You are the one who claimed to be able to afford and fully pay up your house using single income

I have been the one raising affordability concerns vs single / multiple income streams.

G, [21/8/2024 6:18 PM]

No. Govt should be concentrating increasing purchasing power for everyone

Hanny, [21/8/2024 6:18 PM]

We dont want to go the kamalanomics where you try to control prices.

LCL (Danny 心), [21/8/2024 6:18 PM]

All my niece and nephew can afford with a single income.

G, [21/8/2024 6:18 PM]

Afford what? The same 4 room flat they chose?

LCL (Danny 心), [21/8/2024 6:19 PM]

Can afford a house and raise a family with single income.

Too bad if you can't.

Hanny, [21/8/2024 6:19 PM]

I live in 3room hdb and my wife is a housewife. I believe it is doable for many singaporean.

LCL (Danny 心), [21/8/2024 6:19 PM]

Yes 

Realistic and pragmatic.

G, [21/8/2024 6:19 PM]

Koping out again

Hanny, [21/8/2024 6:20 PM]

My wife chose not to work because this is what we want for our family.

Hanny, [21/8/2024 6:20 PM]

less income but we are happy.

LCL (Danny 心), [21/8/2024 6:21 PM]

You can't too bad.

Hanny, [21/8/2024 6:21 PM]

Married Singaporean can afford to buy an hdb after working for 5 years. This is not the case in KL and Jakarta.

Hanny, [21/8/2024 6:21 PM]

I am referring to buying a house in the same city that you work.

Hanny, [21/8/2024 6:22 PM]

when it comes to retirement, we can spend our money in neighbouring countries.

G, [21/8/2024 6:22 PM]

😂 can't admit that HDB flats have become much less affordable over the years?

Hanny, [21/8/2024 6:23 PM]

I have a brother in Toronto and the price of a house in Toronto is really beyond the purchasing power of the local grads.

G, [21/8/2024 6:23 PM]

Why compare affordability with other countries? Why not compare against ourselves?

compare affordability in terms of qty of income streams for a given flat type over the years

Hanny, [21/8/2024 6:24 PM]

We need to compare what we have with other places. And count our blessings.

Hanny, [21/8/2024 6:24 PM]

There are always improvement to be made

Hanny, [21/8/2024 6:25 PM]

When we say KL is cheap, we need to ask the locals with local pay.

Hanny, [21/8/2024 6:26 PM]

Fresh grads in jakarta (from good uni) only earns sgd500 per month. Compare that to our poly grads.

LCL (Danny 心), [21/8/2024 6:27 PM]

My nephew and niece bought about $450,000 4 rm flat.

With grants and take up HDB loan 20 years pay about less than $2,000 from CPF.

Not a single cent cash layout.

Take home pay no impact.

That's why they say cannot afford.

Unless those $2,000 per month and below probably.

So a calculation with those who already bought.

We know who can be believed and who cannot.

LCL (Danny 心), [21/8/2024 6:28 PM]

Single income can afford already.

Wife work, additional income.

More than enough cash.

Hanny, [21/8/2024 6:28 PM]

I paid less than 1k for my hdb from cpf. Not stressful.

LCL (Danny 心), [21/8/2024 6:29 PM]

Now fresh graduates already receive $4,600.

After 3 years easily $5,000 plus 

Some good ones $6,000 plus.

Single income who say not enough.

Want to sian - people not stupid.

Hanny, [21/8/2024 6:29 PM]

it's good that the gov tried to make people more prudent in their mortgage.

Hanny, [21/8/2024 6:30 PM]

it's not enough because they want a condo

Hanny, [21/8/2024 6:30 PM]

expectation needs to be managed

LCL (Danny 心), [21/8/2024 6:30 PM]

Exactly.

I tend to believe your experience because it is credible.

LCL (Danny 心), [21/8/2024 6:30 PM]

Exactly.

It is all about expectations.

Realistic and pragmatic or not.

REACH Singapore, [21/8/2024 6:32 PM]

REACH Singapore, [21/8/2024 6:32 PM]

Dear Contributors, 

Let’s be courteous to one another so that we can have a conducive discussion. 

It is everyone’s responsibility to make this online space a safe and conducive one for all contributors to share your views and feedback on national issues.

Please be reminded of the Terms of Use: https://go.gov.sg/reach-telegram-terms 

Thank you. 

Megan

LCL (Danny 心), [21/8/2024 6:33 PM]

So dual income family is more than $10,000.

Single income about $5,000 or more.

Who say cannot afford a $450,000 4 rm flat?

When CPF can pay $1950 a month loan?

No cash layout needed.

LCL (Danny 心), [21/8/2024 6:34 PM]

Condo one million of course not enough lah.

Head not so big, don't wear a big hat.

Else trip and fall.

Jun Ming, [21/8/2024 6:39 PM]

Nah not getting a house at the moment. Will look how's the housing price outlook down the road

Jun Ming, [21/8/2024 6:40 PM]

Will see lah cause declining birth rate and aging population by right more house will be empty down the road

Jun Ming, [21/8/2024 6:41 PM]

Unless govt keep importing foreigners

Jun Ming, [21/8/2024 6:41 PM]

To keep up the demand

Jun Ming, [21/8/2024 6:43 PM]

So I think there will be one day supply over demand

REACH Singapore, [21/8/2024 6:46 PM]

Dear Contributors,

⏰ We will be closing the chat in 15 minutes ⏰

Thank you very much for being part of our Telegram chat and participating actively.

Goodnight!

Megan 😊

G, [21/8/2024 6:46 PM]

Throwing out raw numbers without appropriate context, and using it to claim affordability 😆 

When the real concern is decreasing affordability.

LCL (Danny 心), [21/8/2024 6:48 PM]

I am telling you, my nephew and niece are staying in their flats now.

Real facts and figures.

Not spewing rubbish.

LCL (Danny 心), [21/8/2024 6:49 PM]

Not giving false facts like CPF cannot use to finance HDB flat.

G, [21/8/2024 6:58 PM]

Yes. No one disputing this claim. 

And it's a fact that for a given flat sizes, houses were more affordable in the 80s than today. 

Because single income at median salary can afford a 4 rm flat in the 80s without grants and 30 yr mortgages, but today cannot. 

And you claim to be able to afford your house on a single income but refuse to say the house size and when you bought it

LCL (Danny 心), [21/8/2024 6:59 PM]

Difficult to talk to you.

I rather shake legs and drink coffee.

G, [21/8/2024 6:59 PM]

Going by the trend for this reach pro PAP echo chamber group, the govt will have end up having negatively skewed data points

REACH Singapore, [21/8/2024 6:59 PM]

Dear Contributors

We will be closing the chat for today.

Thank you very much for being part of our Telegram chat and participating actively.

Goodnight!

Megan 😊

Nicole, [21/8/2024 7:00 PM]

Really...? It depends on the sector doesn't it?

====

*To close the loop if last topic, in a married family of single income - can afford 5-room BTO flat*

5 Room flats :

Boon Lay Glade, Jurong West Jewel $338,000 to $457,000 (5-room)

Aranda Breeze @ Yishun $366,000 to $459,000 (5-room)

Canberra Vista (Sembawang) $350,000 to $406,000 (5-room)

Sun Sails (Sembawang) $336,000 to $388,000 (5-room)

Grove Spring @ Yishun $385,000 to $485,000 (5-room)

Yishun Boardwalk (Yishun) $410,000 to $490,000 (5-room)

Yishun Beacon (Yishun) $485,000 to $595,000 (5-room)

Matilda Riverside $464,000 (5-room)

Woodgrove Edge $412,000 (5-room)

Taking the high side of 5 room flats = $480,000

Minus housing grants = $50,000

Remaining price = $430,000

Take a 20 years loan at 2.6% HDB/CPF loans = $1,838.25 loan installment a month payable to CPF.

A single income graduate (after 3 years of job) = $5,000 (starting pay $4,600).

Self CPF 20% + Employer CPF 17% = $1,850

No cash outlay - single income can pay for a 5 room flat (at 50 years old flat fully paid).

If take 25 years loan (service up to 55 years old), lagi affordable $1,470.60 repayment a month.

Fully payable by CPF.

No cash layout.

(This is to address the one that jump into hasty conclusion without doing the homework 

misleading others. 

Hence single income cannot afford a 5-room flat is not a true statement.)

====

*Respond to why 1960s, 1970s the 5 room flat bigger than now*

1. 1960 and 1970s, Singapore is a undeveloped and under developing country.

Land is not a premium because many high value added investors are not coming in.

Now 2024, Singapore land is a premium.

People got to pay higher for each square foot of land especially in premium areas.

2. 2024 - The 5-room HDBs are the largest type of HDB flat, measuring around 110 to 130 square meters. Source :- Google.

1985 5-room flat size 120 sq metres (about 1,291 sq ft).

Surprisingly, I discover the flat size is almost the same.

3. So if a 5 room flat fetch about $200,000 40 years ago, $500,000 in 2024 is not too far fetch. (2.5 times).

Because 40 years ago, 1 bowl of noodles is $1.

Now is $4. (4 times).

====

*To close the loop on the previous topic - Are HDB flats getting smaller?*

Since 1997, the sizes of HDB flats have remained unchanged, even though the average household size has declined over the years.

What is the size of an old 4-room flat?

The standard size of a 4-room HDB flat is 90 square meters (969 square feet) for new flats and 82 square meters (883 square feet) for older flats.18 Jan 2024.

Source: Google from HDB website.

HDB | Designs-continually-improved-to-better-meet-needs

https://www.hdb.gov.sg/cs/infoweb/about-us/news-and-publications/letters-to-the-media/Designs-continually-improved-to-better-meet-needs#:~:text=Since%201997%2C%20the%20sizes%20of,has%20declined%20over%20the%20years.

=====

*To address the salary of fresh graduates - 2024 fresh graduates salaries*

Art & Business graduates $3,500 (lowest)

IT graduates $7,752 (highest)

Average graduate salary $4,600 (Honour)

Graduate Employment Survey 2023 (Published 2024) | Salary.sg - Your Salary in Singapore

https://www.salary.sg/2024/graduate-employment-survey-2023-published-2024/

====