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8 Mar

HDB to help home buyers live near parents

As Singapore heads towards an ageing population, the government is recognising the need to provide substantial aid to married home buyers who choose to live with or near their parents through various HDB flat balloting schemes. Find out how you can benefit from these newly enhanced schemes. 

Stressing the importance of family ties as the bedrock of a strong society, the Government rolled out two new initiatives last Friday to encourage married children to live with their parents or near them in housing estates. The first is to strengthen the Married Child Priority Scheme (MCPS) to give higher ballot chances to married children who apply to live with their parents in a new HDB flat. The second, known as the Multi-Generation Priority Scheme (MGPS), allows married couples and their parents to buy a flat with a nearby studio apartment or two-room flat. This allows both parties to be close together while still according each a measure of privacy.

In a bid to encourage stronger family ties, HDB is helping married couples secure HDB flats near the parents.

Announcing these schemes in Parliament, National Development Minister Khaw Boon Wan said that many Singaporean families want to live together, or at least near to one another. ‘This forges strong families, besides making a lot of practical sense. Grandparents help to look after their grandchildren… Children set good examples of filial piety. ‘These are strong values which we must inculcate,’ he added.

Under current MCPS rules, a married couple buying a flat for the first time will have four ballot chances, and a second- timer two chances, if they want to reside with, or within 2km of, their parents. The new rules, which take effect from this month’s launch of new Build-to-Order (BTO) flats, will see the ballot chances for a first-timer couple increase to six chances and a second-timer three chances, if they live with their parents in their new flat. The new MGPS was introduced in response to MPs’ suggestions that the HDB build more integrated flats to encourage family bonding.

SkyTerrace@Dawson BTO flats launched in 2009. Image courtesy of HDB.

The scheme was piloted at SkyTerrace@Dawson, where a larger flat was paired with an adjoining studio apartment, allowing extended families to live next to each other. Mr Khaw said HDB will launch 250 pairs of such flats in various estates this year, starting with the Bedok BTO project in March. It will launch more if the scheme proves to be popular. Given that the elderly parents of married children tend to live in mature HDB estates, Mr Khaw said his ministry will build more new BTO flats in these locations so that the young and old can more fully take advantage of the new schemes introduced. ‘This year, there will be BTO launches in Bedok, Kallang, Whampoa and Geylang,’ said the minister.

‘Indeed, 30 per cent of BTO flats to be launched this year will be in mature estates.’ HDB is expected to roll out some 25,000 new flats this year. Flats in mature estates are normally more sought after, as they come with amenities like schools and shops, and good transport links. Applicants under the MGPS will have priority over others, as they will have the first dibs on choosing a flat nearby.

The Straits Times © Singapore Press Holdings Ltd. Reprinted with permission.

Editor’s Commentary:
Will this shift in population signify a possible change in the type of HDB flats or even private properties preferred? Instead of stand-alone studio flats for the elderly, will this be a better way of taking care of our senior citizens? Has anyone asked the elderly what they prefer?

7 Mar

Helping all Singaporeans secure a Home

Divorcees, widows and the lower-income earners. The housing plight of these groups of Singaporeans have been the focus of debate in Parliament. What have the government come up with and will policies be amended to help them secure a roof over their heads?

The plight of divorcees, widows and the poor came to the fore in Parliament yesterday, as a dozen Members of Parliament spoke out passionately for groups in society that have been disadvantaged by Singapore’s public housing policies. In response, Minister for National Development Khaw Boon Wan pledged that the Government would ‘strive to govern with compassion’ and make exceptions for the truly needy.

Besides schemes for singles and the elderly, HDB also has a Special Housing Grant for low-income families

At least three MPs brought up the plight of divorcees, who have to wait five years from the date a divorce is made final before they can buy an HDB flat or be listed as an occupier. They also have to deal with a 30-month debarment period after selling their flats before they can apply for subsidised rental housing. Highlighting cases where divorcing couples are ordered by a court to sell their matrimonial flats, Mr Lim Biow Chuan (Mountbatten) said it is unhealthy for single parents and their children to have to resort to sharing a confined living space with relatives because they cannot find another place to live. ‘Instead of the standard policy of asking the divorcee to wait for a debarment period of 30 months, can HDB allow divorcees with children to rent a flat quickly? Alternatively, can they be allowed to buy a flat directly from HDB?’ he asked.

Mr Khaw said his ministry was in fact ‘sympathetic to divorcees’, especially those with young children. He noted that 670 rental flats were allocated last year to divorcees with children, making up more than 20 per cent of such allocations last year. But he also cautioned that only truly special cases should get help, to avoid the potential for abuse. ‘We must be mindful that divorcees do not form a homogenous group. In the West, many sympathetic rules designed to help divorcees get abused, with couples claiming such benefits even though their marriages are intact,’ he said.

How does renting a HDB flat or even just a room in the market compare to renting one provided by the government?

Other MPs asked if the ministry would consider allowing singles to buy new flats, adding that being single was often not a matter of choice. Associate Professor Muhammad Faishal Ibrahim (Nee Soon GRC) said many older singles who live with their parents often hope they can buy a flat of their own, but are held back as they are limited to more expensive flats on the HDB resale market. Mr Khaw clarified that current regulations do allow singles above 21 to apply for a flat with their parents. ‘Beyond that, I am still mulling over how to help singles,’ he said. ‘We must not unwittingly compromise on the promotion of marriage and mutual family support that we have long held.’

Mr Khaw added, however, that his ministry will always try to help Singaporeans in distress due to circumstances beyond their control, such as the sudden death of a breadwinner.  ‘These are victims of misfortune and sometimes our policies and rules leave them cold on the wrong side,’ he said. He said that although his ministry designs policies to cater to the vast majority of the population, with clear rules to prevent abuse or gaming of the system, it had to exercise compassion and treat deserving cases as special. ‘For victims of misfortune, I have impressed on my MND colleagues that our default position is to try and say ‘yes’, to give such victims a leg up at a time of need,’ he said.

There is the CPF Housing Grant, and many other schemes to help citizens. But has enough been done? Is it time for policy changes?

Mr Khaw also responded to a call by Ms Foo Mee Har (West Coast GRC) for his ministry to take action to protect families that get into trouble when they monetise their flats to pay off loan-shark debts. He said he takes the issue seriously and will step up checks on prospective flat sellers to make sure they have a place to live in after their flat is sold. Mr Khaw’s comments were welcomed by Ms Jocelyn Chan, 21, a health-care worker, and her family. Ms Chan and her two siblings, aged 19 and eight, have been living with their 45-year-old mother in a one-room rental flat since their parents divorced two years ago. Ms Chan and her mother approached their MP, Ms Lee Bee Wah, as they faced difficulties convincing the Housing Board that they could afford a three-room flat with their combined income of $2,700. It’s frustrating that we cannot apply for a flat, even though my mother and I can afford it. All we hope is that they relax their regulations so my siblings can grow up in a healthy environment,’ Ms Chan said.

The Straits Times © Singapore Press Holdings Ltd. Reprinted with permission.

Editor’s Commentary:
Policy changes are not simple maneuvers but as societal dynamics change, and at increasing speeds, policies need to keep up. Will there be any housing regulations shake-ups this year? And how will they benefit Singaporeans and change the local property market landscape?

6 Jan

Public housing policy shakeups in 2011

What were the key milestones for public housing last year? What will 2012 hold for Singapore in terms of providing sufficient affordable housing for all income groups?

Public housing underwent a sea change in 2011, with cornerstone policies up- ended in response to fresh challenges and the demands of an increasingly vocal population. Red-hot demand and the resulting record high prices for homes made the affordability of public housing one of the hottest topics in May’s general election. When the dust settled, the Ministry of National Development (MND), which oversees the Housing Board (HDB), found itself being led by a new pair of hands.

Singaporeans seem positive about the future of public housing.

Out went Mr Mah Bow Tan after 11 years at the helm, and in came Mr Khaw Boon Wan, who had volunteered for the ministerial hot seat. Mr Khaw, who had kept a blog in his previous job as health minister, transplanted this practice to his new ministry. His ‘Housing Matters’ blog became the first to explain housing issues; he also used his Facebook page to respond personally to questions. On his watch, the HDB saw a slew of policy shifts that slaughtered some sacred cows in public housing policy. The most surprising one came in August, with the raising of the monthly income ceiling from $8,000 to $10,000 for build-to-order flats, and from $10,000 to $12,000 for executive condominiums. The Government had defended the 17-year-old income ceilings as relevant as recently as five months before this.

A second policy change was in making the ‘build-to-order’ policy one of ‘just build’: Where the HDB used to launch a construction tender for such flats only when at least 70 per cent of the units had been sold, it now calls for tenders as soon as architectural drawings and tender documents are ready. This has enabled a record 25,200 build-to-order flats to be launched this year.

How will the prices of BTO flats compare to resale HDB flats in the Bedok neighbourhood?

Third, the HDB signalled it will look into building more flats in mature estates, a departure from its previous policy of offering new flats only in new towns. Fourth, the ministry announced a review of the formerly popular Design, Build and Sell Scheme (DBSS), following public outrage over a Centrale 8 DBSS unit in Tampines bearing an original price tag of $880,000. DBSS projects were HDB’s experiment in farming out the development of public housing to private developers. Land sales for such projects have since been suspended, and the future of the scheme has yet to be decided.

Along with the policy changes, an unprecedented amount of information was made public, mostly through Mr Khaw’s blog. He unveiled the profile of home buyers, application rates for first- and second-time buyers, and analysed supply numbers. However, the HDB stopped issuing the quarterly median cash-over-valuation (COV) figure – which is the cash paid by buyers above a flat’s valuation – saying it may not be representative of the market. The changes prompted industry observers to dub 2011 an unprecedented year in public housing. PropNex chief executive Mohamed Ismail called it an ‘exceptional’ year, given the new rules and restrictions which will affect the property sector.

Will the DBSS scheme be put away for good? Image courtesy of ThinkStock.

Housing: What to look out for in 2012

1) Another bumper crop of flats in 2012
The Housing Board will offer another 25,000 BTO units next year, starting with a January launch of 3,890 flats offered for sale in Choa Chu Kang, Punggol, Sengkang and Tampines. This year, the HDB launched a record 25,200 BTO flats. In 2009 and last year, the HDB launched about 9,000 and 16,100 BTO flats respectively.

2) Higher chance for second-timers
Second-timers could see higher chances of getting a home, as Mr Khaw Boon Wan said the HDB will tweak the balloting rules to enhance the chances for second-timers when the backlog of demand from first-timers is cleared. In the latest BTO launch in November, the day that applications closed for the units, the overall first-timer rate – revealed by the HDB for the first time – was 1.4 This means 1.4 applications came in for every first-timer unit on offer. Mr Khaw had said it was his wish the first-timers’ application rate would come in below two.

3) Fate of DBSS likely to be decided
Complaints of escalating prices may just see the scheme scrapped. DBSS projects were the HDB’s experiment in farming out the development of public housing to private developers. But following public outrage at a Centrale 8 DBSS unit in Tampines bearing an original price tag of $880,000, land sales for such projects have since been suspended. The scheme however continues to be popular with potential home owners, which seems to suggest that there is still a demand for such housing types.

Source: The Straits Times © Singapore Press Holdings Ltd. Reprinted with permission.

Editor’s Commentary:
Are these questions on your mind?: Will the DBSS scheme be eliminated for good? Will young couples be more likely to receive their first HDB flat sooner and at a lower price? Will the bumper crop of new BTO HDB flats put a dent in the resale HDB flat and private home market?

 

25 Nov

Results and thinking: which should come first?

A recent conversation I had gave me insight into how, as Singaporeans, we place too much emphasis on past results, and that our way of thinking is shaped by these results and other experiences observed.

Innovative thinking is needed to solve Singapore's housing problems. (Image courtesy of ThinkStock.)

Innovative thinking is needed to solve Singapore's housing problems. (Image courtesy of ThinkStock.)

Too much emphasis is placed on funding performance history. Yes, it is useful for us to measure current housing performances against past performances, such as keeping tabs on the house prices. But relying on old methods to solve new problems can only take Singapore so far.

Like other problems that Singapore faces, issues in the housing market are dealt with using a heavy reliance on technical analysis, like comparing past and present rates of Build-To-Order (BTO) housing over-subscription, price hikes (and drops) and so on.

To effectively resolve our housing needs, our thinking and funding should not be entirely based on performance history and past results. Rather, creative thinking and efficient execution of policies should directly lead to positive results.

I believe this is partly the reason Singapore’s government housing policies have been stuck in a virtual limbo. Back when Singapore was struggling towards independence and naysayers doubted the country’s ability, it was then Prime Minister and current Minister Mentor Lee Kuan Yew’s vision to model Singapore after successful countries that made the country what it is today in just three decades.

Today, however, things are much different. Singapore is now one of the most successful Southeast Asian nations. The problem of rising housing costs we face now is a completely different set of problems that requires new approaches to solve. We cannot afford to be rehashing the same solutions in a situation that calls for innovative thinking.

National Development Minister Khaw Boon Wan’s solution of releasing a bumper supply of BTO flats is one way of quickly dissipating demand; but in the future, when there is no more land to release, even more creative thinking will be needed to fulfil housing demands. Policy makers have already begun exploring the construction of homes skywards and seawards, so what about doing so downwards for instance?

If Singaporeans and their government are looking to make a change, why not take a leaf from companies with exceptional visions? One such company is Apple, which did not start out in the mobile phone industry. While it took established mobile phone giants like Nokia and Motorola 10 years and hundreds of models and features to get to where they currently are, Apple accomplished similar achievements in half the time and with only one phone model.

If we encourage a culture of innovative thinking to solve not just Singapore’s housing problems, but other issues in transport and healthcare as well, we will certainly get positive results.

17 Nov

Higher success rate for first-time HDB flat buyers

National Development Minister, Khaw Boon Wan has quoted newly released figures of first-time buyers receiving their new homes, saying the rate of success is now higher. Is the sheer number of new HDB flats enough to supply the strong demand on the ground?

First-time buyers of Housing Board (HDB) flats are finding it easier to get their new homes, according to figures released yesterday by National Development Minister Khaw Boon Wan. The numbers from a July build-to-order (BTO) sales launch by the HDB show that at least seven out of 10 first-time buyers – or 73 per cent of those who applied – were invited to select a flat.

HDB's latest launch of new BTO flats in November 2011. Image courtesy of HDB.

The HDB received 12,116 applications for 3,556 flats launched across towns such as Yishun, Bukit Panjang, Sengkang, Tampines and Jurong West. This means there were 3.4 applicants for every flat available. Mr Khaw also cited figures to show that second-timers had a relatively low success rate of 11 per cent, as only 5 per cent of new flats are kept for this group.

While first-time buyers remain the priority for now, Mr Khaw said that second-timers can expect more flats to be made available to them in the near future. Writing on his housing blog yesterday, Mr Khaw said: ‘After we have cleared most of the first-timer queue, we will tweak the balloting rules to enhance the chances for second-timers. This should be towards the end of next year. I seek their patience and understanding.’ The success rate for the July launch was higher than in the HDB’s May BTO exercise. The percentage of first-time applicants who were asked to select a flat then was 45 per cent. In the February launch, which was oversubscribed by five times, the success rate ranged from 37 per cent to 59 per cent for first-timers, according to Mr Khaw’s previous blog posts.

Fernvale Rivergrove BTO flats launched in September 2011. Image courtesy of HDB.

Mr Khaw added that since he joined the ministry in May, the HDB has launched 16,000 new flats – of which nearly 14,000 were reserved for newlywed first-timers. ‘With this ramped-up construction programme and priority in treatment, newlyweds now stand a very high chance of succeeding in BTO selection,’ he wrote.

Mr Khaw said yesterday that he was confident the situation at the September launch of more than 8,000 flats would show further improvement. He also noted that not all who were invited to select a flat did so. About three in five couples – or 62 per cent – who were invited to select a flat bought one in the end. Among them were sales executive Yvonne Koh, 26, and her partner, who were third time lucky when they applied for a flat in Sengkang in the July BTO launch. They received the queue number 820 for the 700 units available for the project. ‘We didn’t think we would get one, but we got invited to select a flat. Although the flat was not our first choice, we got one on a high floor that we are happy with,’ she said. The couple paid $360,000 for a five-room flat on the 13th floor.

Golden Carnation - New BTO flats launched in Tampines in July this year.

Analysts The Straits Times spoke to yesterday said the HDB’s aggressive ramping-up of supply seems to be soaking up strong demand from first-time buyers in the market. ERA Realty key executive officer Eugene Lim said the move to bunch projects together in large launches instead of launching them one-by-one looks like it is paying off. ‘With a bigger pool of flats to choose from, the buyers’ success rate is higher,’ he noted, adding that the big sales launches have helped to alleviate demand in the red-hot public housing market.

However, PropNex chief executive Mohamed Ismail said that while the bumper supply has had a significant impact on the new-flat market, it has had a limited influence on buyers in the resale market, who cannot wait three years for a BTO flat to be built.

Source: The Straits Times © Singapore Press Holdings Ltd. Reprinted with permission.

Editor’s Commentary:
The government is counting on the quantity of new HDB flats to the success rate of first-time HDB buyers getting their first home. Are these successes apply to everyone? Does the possibility remain, of individuals or families who are not able to afford even their first home? 

21 Oct

Cooling measures will stay for now

National Development Minister, Khaw Boon Wan, has said that the property cooling measures are here to stay. What are his reasons and what are his expectations for Singapore’s housing situation in the next four years?

National Development Minister Khaw Boon Wan yesterday said that it is not time yet to remove property cooling measures and that the government will continue to release land to meet private housing demand. In a speech in Parliament, he noted that private housing currently makes up 23 per cent of Singapore’s housing market and meets the upgrading aspiration of higher-income Singaporeans, besides housing the permanent residents and foreigners who come here to work and live. ‘URA will continue to release land parcels to meet the demand. ‘Four rounds of cooling measures have also had their effect. There have been some calls for their removal but I don’t think it is time yet. The global economic uncertainties have also tempered exuberance,’ he said.

 

Citylights condominium in the city fringe, near Little India.

Urban Redevelopment Authority’s latest flash estimate released earlier this month showed that the escalation in the private home price index has moderated for eight consecutive quarters. The 1.3 per cent quarter-on-quarter rise in the index in Q3 2011 was the lowest rate of increase over the past two years. ‘We will continue to monitor market conditions closely, and if need be, we will take further measures,’ Mr Khaw said.

The government has rolled out four rounds of measures – between September 2009 and January 2011 – to cool the private housing market. Standard Chartered Bank property analyst Regina Lim does not believe that further cooling measures will be announced. ‘At this point in time, a lot of people who are buying are not speculators. They are buying for investment or their own occupation. How do you stop them? However, Ms Lim argues that it is not time to remove the existing cooling measures either because interest rates are still low. ‘Interest rates of about one per cent on home mortgages, for a country with 5 per cent annual GDP growth are distorting people’s behaviour and making them buy more housing. Unless we have a nominal interest rate of about 3.5 per cent, we still need the cooling measures,’ she added.

What effect do the cooling measures have properties in prime districts such as this condominium, Waterscape @ Cavenagh in the Orchard road area.

But Ms Lim predicts that the supply of private housing land that the Ministry of National Development will release under the confirmed list in the first half 2012 Government Land Sales (GLS) Programme may ease, perhaps to about 3,000-4,000 private homes (including executive condos), after three consecutive rounds of half-yearly land sales programmes for about 8,000 private homes since H2 2010. ‘This would have made up sufficiently for the undersupply in the past 10 years,’ she reasoned.

Credo Real Estate executive director Ong Teck Hui does not expect the government to remove the present cooling measures or reduce the quantum of confirmed list land sales for H1 2012 given that private home prices have not come down and developers’ sales are still strong. URA figures released earlier this week show a rebound in developers’ private homes sales in September. They sold 1,631 private homes, excluding ECs, last month, up 20.7 per cent from August. Including ECs, the September sales volume rose 25.8 per cent month on month to 2,064 units. ‘The authorities would probably adopt a more prudent approach of adjusting the GLS Programme if the economy deteriorates rather than to pre-emptively reduce the quantum now,’ said Mr Ong.

Source: The Straits Times © Singapore Press Holdings Ltd. Reprinted with permission.

Editor’s Commentary:
What effects would removal of the cooling measures have on the market? Will market forces push prices up even further or have they reached a saturation point? Perhaps we could also ask, what is the saturation point? 

4 Oct

Resale HDB flats rise in price

As the private non-landed residential market takes a backseat, resale HDB flats are leaping forward in terms of rising prices. Despite HDB’s announcements and applications for new BTO and sale of balance flats exercises, this property market does not seem to be waning yet. Why is that? And when will the prices recede, if ever?

Prices of resale HDB flats continued to increase in the past three months but National Development Minister Khaw Boon Wan said efforts to ramp up supply of new flats should help stablise prices soon. The Housing Board’s (HDB’s) flash estimate of the third-quarter resale price index is 187.1 – or 3.8 per cent higher than the previous quarter.

Despite launches of BTO and SBF flats, resale HDB flat prices continue to rise. Seen here is the Golden Peony BTO flat in Jurong West. Image courtesy of HDB.

Mr Khaw, in his latest blog post, said HDB is ‘making good progress’ in meeting the needs of first-time applicants who are newly-weds. Last month , for example, HDB put up for sale 8,200 build-to-order (BTO) and sale of balance flats (SBF) – including units in mature estates such as Bukit Merah and Clementi – to cool the demand for resale flats. The balance flats were wildly popular, with some in mature estates seeing 50 times as many buyers as there were units available, while the BTO exercise registered an average application rate of 1.7 times.

HDB flats in mature estates such as Bukit Merah will see 'new' neighbours soon with building of new BTO flats.

Mr Khaw expects half the 15,500 first-time applicants to get flats. ‘This September launch has redressed part of the shortage in public housing. Our efforts in ramping up HDB flat supply will help stabilise the market. We are beginning to see some light at the end of the BTO tunnel,’ he wrote.

Experts said the continued buoyancy in resale-flat prices is a sign that homeowners are now more reluctant to put their units up for sale. ERA Realty key executive officer Eugene Lim said property owners in general have become more cautious about selling their homes and getting another, after the Government lowered the loan-to-value limit to 60 per cent for those with existing property loans. He added that cash-over-valuations (COVs) continue to boost resale-flat prices. COVs are cash premiums paid above the official value for resale flats. Industry experts estimated that the COV was between $35,000 and $37,000 in the last quarter. Mr Lim said the market may continue in this fashion unless there are policy changes that can increase the supply of resale flats for sale.

 

Loft @ Nathan, one of the new property launches available to buyers.

PropNex chief Mohamed Ismail predicts that resale-flat prices will have climbed by as much as 11 per cent by the end of the year. ‘In spite of this, we are expecting prices to stabilise with the introduction of more new BTO and SBF flats,’ he said.

Mr Nicholas Mak, research head of property consultancy SLP International, estimates that resale-flat prices will have increased by up to 14 per cent by year’s end, as it will take time for the effect of HDB’s large BTO launches to be felt. Mr Lim noted that new flats may not appeal to all first-time buyers , due to the waiting time of at least 21/2 years for the units to be completed.

Private-property prices, however, are showing signs of moderation. The Urban Redevelopment Authority’s private residential property index rose 1.3 per cent in the past three months, compared to 2 per cent in the previous quarter. Non-landed properties in Outside Central Region areas chalked up the highest price increase of 2.1 per cent. Those in the Core Central Region and Rest of Central Region had 0.8 per cent and 1.1 per cent rises respectively. The Core Central Region includes prime areas like Orchard Road and Newton. The Rest of the Central area includes Outram and Rochor. PropNex’s Mr Ismail said the strong showing by properties outside the central regions is due to recent launches of mass-market condominiums in those areas.

Source: The Straits Times © Singapore Press Holdings Ltd. Reprinted with permission.

Editor’s Commentary:
New BTO flats are coming up in not only in the newer HDB towns, but also in older mature estates. As they are yet to be built or occupied, it will be interesting to see if their presence affect resale HDB flat prices two to five years down the road. Although, the factors affecting this may be manifold. Which way do you think the market will turn?

18 Aug

Are COV prices important to you?

COV is here to stay. No question about that. And correspondingly, HDB has removed the overall median COV for HDB resale flat transactions data from their website. But the question industry players and buyers alike are still asking is “What does this indicate about the authority’s commitment to transparency?”

The issue of cash over valuation (COV), the bane of cash- strapped buyers of second- hand public housing, has hit the headlines again. This time round, the action took place on Facebook, where National Development Minister Khaw Boon Wan rejected calls to abolish the COV. Doing so in the past had led to people declaring false sale prices, he wrote.

How important is it for buyers to have prior knowledge of COV prices? Image courtesy of Singapore Tourism Board.

The COV is a closely watched figure as it is the part of a flat’s price above its valuation, and cannot be financed with a loan. In a rising market – like now – it can go into tens of thousands of dollars, pricing flats out of reach of some buyers.

Yet the Housing Board (HDB), which tracks resale flat transactions closely, recently raised eyebrows by removing some key COV figures from public view. Not only has it stopped giving out summary COV figures like the overall median COV for HDB resale flat transactions every quarter, it has also removed historical information – dating back to 2007 – from its online database.

The axe started falling last month, when the HDB stopped disclosing the overall median COV figure for its report on April to June transactions. The percentage of resale flats sold above valuation got the chop too. Gone also was data on the national median COV according to flat type, as well as the overall median COV of transacted flats in a town.

Hence, while it is possible to find the median COV of a four-room flat in Queenstown, one can no longer find out the median COV of all flats in Queenstown, and the median COV of all four-room flats transacted that quarter.

The HDB has explained that it removed the overall median COV figure which depends ‘on the mix of flats transacted, which vary from quarter to quarter, and hence are not as relevant’. Mr Khaw, meanwhile, says it is ‘misleading’.

But critics ask if the decision was made to save the Government from the embarrassment of rising COV figures despite property cooling measures.

Prices of resale flats rose 3.1 per cent from April to June after a small 1.6 per cent rise in the first quarter. The overall median COV figure was estimated by major property agencies to have reached about $30,000 in the April to June period, which would have amounted to a 43 per cent increase from the quarter before.

It is true – as the HDB argues – that the median COV figure is not as helpful as similar information broken down by location. Some property analysts wonder if it drives up prices by creating unrealistic expectations from sellers. On the other hand, summary COV figures – such as those by flat types or towns – have their functions. They help a buyer or seller get a better sense of ground conditions when the transactions for a particular category of flats are too few in that quarter for its median COV to be representative.

How do the COV prices of different HDB resale flats in a locale compare?

Granted, the overall median COV figure is a blunt measure because COV data from different districts are not assigned weights according to how representative those transactions are of the national picture. But it serves some purpose.

In the same manner, Singapore’s gross domestic product, a topline figure of economic fortunes, is closely tracked and studied even though it does not drill into patterns of growth. It does not, for example, indicate whether home-grown companies are thriving, if fewer Singaporeans are unemployed, and whether the net wealth of locals is growing. It is simply a measure of the value of goods and services produced in the country.

To withdraw data from the public domain because a government agency considers it ‘not as relevant’ raises questions about the nature of the more consultative democracy pledged by the Government. Data can always be presented with caveats by the state – and treated with caution by a mature electorate. By withdrawing historical data summarily from databases, the HDB is signalling that it is the sole arbiter of what is relevant. Some will say it does not trust the public to be mature enough to use the data correctly.

Should the Median COV prices of resale HDB flats stay accessible to all? Image courtesy of HDB.

Had there been some public debate about the COV data, the conclusion might well have been similar – that the figure in question is deeply flawed, and it is best to remove it from the public domain. But home buyers and sellers will never know, because they never had the opportunity to be part of that conversation.

To be fair, the Ministry of National Development (MND) and its agencies like the HDB and Urban Redevelopment Authority have in recent years been relatively proactive in putting data in public. Mr Khaw, since taking over the MND, has further reached out to disenchanted home buyers. He blogs often. In the past few months, he has posted fresh data on wide-ranging subjects like the percentage of recent applicants asked to select a new flat, the proportion of those who actually take it up, as well as the types of buyers for different types of flats.

But such release of data, however well-intentioned, is of limited use. The ad hoc nature of their disclosure and constantly shifting parameters make it difficult for the average citizen to develop a meaningful understanding of the subject over time. It is data equivalent of a one-way conversation.

In the long run, there is simply no substitute for data gathered and disseminated in a regular and consistent manner by all government ministries. They also need to be available in a format easy for scrutiny, to encourage more informed discussion and active citizenry.

Profile of applicants for new HDB flats. Table courtesy of the Ministry of National Development.

Public data, one could argue, is the true benchmark of transparency. Town halls, blogs, Facebook pages and consultation panels go some way towards engaging the public in practice of government. But to really walk the talk, the Government will also have to stay committed to timely releases of meaningful and comprehensive data. Even – or especially – when the numbers don’t paint a rosy picture.

Source: The Straits Times © Singapore Press Holdings Ltd. Reprinted with permission.

Editor’s Commentary:
What do you think these COV actually do for your decision-making process? From a recent iProperty survey, it showed that most Singaporeans are willing to pay COV prices of $10,000 – $25,000, some even up to $45,000. Will you ever be able to recoup these additional financial outputs? Or is it a small price to pay to secure your home of choice?

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