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Push for greater inclusivity may drive down resale potential of HDB flats

With a firm emphasis on equal opportunity and inclusiveness, National Development Minister Desmond Lee discussed the possibility of regulating the reselling of future Build-To-Order (BTO) flats located in prime locations.

Push for greater inclusivity may drive down resale potential of HDB flats_Home Quarters SG_KC Ng Keng CHong

National Development Minister Desmond Lee PHOTO: MCI

This announcement should not come as a surprise. In March this year, the previous Minister of National Development, Mr Lawrence Wong, had already highlighted in Parliament the need to curb “social stratification” that may arise due to the relatively high prices of resale Housing Development Board (HDB) flats in mature estates and prime locations, as shown below. 

Push for greater inclusivity may drive down resale potential of HDB flats_Home Quarters SG_KC Ng Keng CHong

Data taken from hdb.gov.sg

This may come as a surprise. Didn’t we just see in the news that HDB home prices have been dropping in the past 2 years? It seems that with the startling number of million-dollar and above resale HDB flats sold last year and in the first 10 months of 2020. The government has decided that it needs to firmly clamp down on the number of expensive resale HDB flats in prime locations being sold.


Before we can go into the exact details that Minister Lee highlighted, we might ask,

What’s the problem with these Resale HDB flats being sold at high prices?

Push for greater inclusivity may drive down resale potential of HDB flats_Home Quarters SG_KC Ng Keng CHong

Average Price per Sqft of resale HDB flats in CCR vs OCR regions in the past 15 years

It’s an undeniable fact that houses located within the Core Central Region (CCR) are relatively more expensive to their Rest of Central Region (RCR) and Outside Central Region (OCR) counterparts, for reasons such as surrounding amenities and their convenient locations.

[psst: still not sure what exactly the CCR, RCR and OCR are? Check out our super short video that succinctly explains these regions here.]

Why, then, is the government trying to interfere with the free market?


This is because the original goal of HDB flats being accessible to all members of the public at affordable prices has been skewed.

Minister Lee stressed that, as the purpose of public housing was to allow Singaporeans of all backgrounds to live in their desired regions, the “principle of fairness” was of utmost importance.

Push for greater inclusivity may drive down resale potential of HDB flats_Home Quarters SG_KC Ng Keng CHong

Data taken from squarefoot.com.sg

He explained this further by establishing that while BTOs in prime locations are sold to homeowners at a highly subsidised price through ballots to ensure that flats in all locations are made affordable to all hopeful applicants, in the future, the price of such flats undergo steep appreciation, allowing past homeowners to earn large profits with low initial cost.

From the table, the hefty profits are earned by all sellers. BTOs in prime locations and mature estates reap far greater profits than their non-mature estate counterparts.

After these flats undergo a few rounds of buying and reselling, it is highly likely that “only wealthy people can afford this type of housing”, limiting the diversity of households living in prime locations.

Thus, he has announced that the Ministry of National Development (MND) will be implementing cooling measures in the near future to prevent prices from soaring.


So what measures are being implemented, exactly?

Adopting a two-pronged approach, Mr Lee stated that the MND will continue to purposefully include two-room flats for elderly occupants and rental flats for lower-income households. Even in future estates located in the CCR, so as to boost inclusivity within estates. Furthermore, the MND may be rolling out new policies to curb the growing prices of resale HDB flats in the near future.

In a Facebook post made on 11 December, he notes that as the government has been taking feedback from the general public. The MND has received various suggestions to introduce “some restrictions on the resale conditions for future prime area projects”. However, he does not specify the exact measures that will be implemented.


Prediction

So, can we predict some of the measures that will be rolled out?

Let’s go through four measures that many speculate may be implemented.

  • Increasing Minimum Occupation Period (MOP): The government may choose to extend the current compulsory 5-year MOP. Forcing homeowners to stay in their BTO for another few years before they can sell their flat. However, many speculate that this would simply delay the inevitable sale of flats at windfall prices for a few years.  Moreover, this would inconvenience those who genuinely need to sell their flat after the usual stipulated MOP period.
  • Shortened lease: The government may choose to shorten the lease of HDB flats in prime locations. While interested parties may still end up buying these resale flats. They might do so at a lower price as they believe the value of the house has dropped. However, this may put those who bought the flat for the sake of staying in it for as long as possible at a disadvantage.
  • Resale to HDB: Some have speculated that HDB may enforce a rule stating that any flat in the CCR can only be sold back to HDB, who buys it at a set price based on the years left on its lease. HDB will then be the sole seller of any resale HDB flats in the CCR, at more affordable prices. While this may seem practical on paper, such a policy may cause dissent amongst homeowners as they are forced to sell their own flats at a price that they cannot control.
  • Limiting Final Price: Some have suggested that the government put a cap on the selling prices of flats in prime locations. However, this measure may simply backfire as it simply invites more buyers to buy the house at the maximum price. In other words, the price ceiling may simply turn into a fixed price floor.

Preparation

Taking into account these potential measures, How should we prepare ourselves for any policy changes?

While nothing will be confirmed until the MND officially implements any policies. We should begin viewing investment properties with increased prudence, and prepare ourselves for drops in the prices of resale HDB flats. Especially those in the CCR region, or larger flats in mature estates.

Most importantly, as buyers, we will have to consider our options with even more cautiousness. As we may see the future prospects of potential flats be severely limited in the near future.


Contact Us

In the meantime, as usual, life goes on. If you’re looking to sell your house and want some professional input, or find that your property is taking a little too long to sell, we’d be happy to help you out! Similarly, if you have any questions or opinions regarding this article, we’d love to hear them as well.

Just whatsapp message or call KC from Home Quarters and begin finding your new home today: +65 8809 2889! Drop us an email at homequarterssg@gmail.com! Shoot us a message on our Facebook or Instagram pages, and we’ll be glad to lend a helping hand. That’s it for this article! Stay safe everybody, and remember, call Home Quarters and start packing!

Best Buys on Taobao to Elevate Your New Home

Now that you have a new place you can call your own – how do you elevate your house to become a home? You do not have to break the bank to fill your cozy little space! Just like many of your peers who have turned to Taobao, you may have scour the website to find yourself overwhelmed by the amount of choices there.

Taobao has made modern aesthetic decor so much easier, but first, you have to choose. Here, we have curated some of the best buys on Taobao that will bring style and everyday practicality to your daily routine.


Best Buys on Taobao for the Kitchen

#1 Kitchen Towel Dispenser

For those that enjoy cooking – whether is it a daily activity or a weekend hobby, you will find that having a good kitchen towel dispenser is absolutely essential! This nifty, handy dispenser can be suspended from a ceiling or a wall. This allows you to place it at a location where it is the most convenient for you.
Purchase link


#2 Fridge Side Carrier

For a welcoming and homey touch, you can hang this pretty fridge side carrier. It also provides extra storage space beside the fridge – perhaps to store some stationery or kitchen supplies. Not only that, it makes for easy cleaning – simply pop the entire carrier into the washing machine instead of having to wipe the fridge down.

Purchase link


Best Buys on Taobao for the Service Yard

#3 Hanger and Pegs Holder

Laundry chores are part of everyday life. As much as we want to imagine a Konmari-lifestyle and hide these unsightly things in the storage all the time, it may not be practical. This chic hanger and pegs holder is a must-have for minimalist home decor. This aluminium holder is in matte black, and does not require any drilling to secure it to the wall.

Purchase link


#4 Classy Umbrella Holder

For tropical dwellers in Singapore, it would be essential to have an umbrella holder for rainy days. What’s better is to get an elegant one that will greet you everytime you come home!

Purchase link


Best Buys on Taobao for Lighting

#5 Denmark Centrepiece Lamp

If you’re looking for a bit more oomph in your living room, consider investing more in a state of the art lighting centrepiece. Why not, since you would be looking at it everyday, and guests would certainly notice it and be impressed! These chic lamps from Denmark are eye-catching and not too loud. The shop that sells these lamps also have a range of styles to match your home decor. 
Purchase link


Best Buys on Taobao for Storage

#6 Stylish Storage Basket

Chances are, you would need storage baskets for laundry, extra magazines, or even pet supplies. These baskets help you hide the clutter – so they had better look good while doing it. These baskets are stylish and fit into the Nordic theme of most homes nowadays. 

Purchase link


Best Buys on Taobao for Drawers & Shelving

#7 Wooden Book Shelf

Shelves may appear to be mundane furniture, but any interior designer would tell you to never go easy on details. These shelves would nicely display your books and favourite souvenirs from memorable trips. The shape and cutting of this shelf is also not your run of the mill sort from Ikea, adding sophistication to any room you place this in. 

Purchase link


#8 Bedside Table

When we are sleepy from our slumber and trying to grab our smartphone or spectacles, how many times would these items fall to the ground? This bedside table is one with a smart design – notice the little catch at the edge? It helps to prevent this clumsy situation (and broken phone screens!) 

Purchase link


Conclusion

What other fantastic home items did you spot on the wonderful shopaholic haven of Taobao? There are so many new and ingenious items featured everyday – so let’s share the knowledge with others by commenting below! Let’s build the longest list of the best buys on Taobao for home decor and practical needs! 


Contact us

If you are looking to conduct any home buying, selling or renting, be sure to reach out to KC from Home Quarters on YouTube, Facebook and Instagram or email us, here at: homequarterssg@gmail.com!

That’s it for this article! Stay safe everybody, and remember, call Home Quarters and start packing!