By Leong Sze Hian
I refer to National Development Minister, Mah Bow Tan’s letter “Pricing flats according to their value” (Today, Oct 29). 
On the same day, the New Paper had a 5-page feature containing four articles about the homeless in Singapore.
What struck me most, was the insensitivity of the HDB spokesman, who told the New Paper, “Homelessness is not just a housing issue, but a reflection of deeper personal and social issues – It cannot be resolved simply by granting homeless persons rental flats”.
For one of the homeless families – a divorced mother and her two 11 and 13 year old children, who have been living in HDB lift lobbies and on cardboard boxes in void decks and corridors, the HDB said that they were not eligible for a HDB rental flat until 30 months after she sold her previous flat, and are also not eligible to buy a three-room flat directly from the HDB as she had bought and sold two flats before.
The most important measure of affordability of public housing is arguably, the number of flat owners who cannot pay for their flats. This may also be the least desirable outcome, that every country’s public housing agency try to avoid most.
In this regard, I would like to refer to the HDB’s reply “Reduce default risk” (Today, Oct 9) to my letter “No choice but take bank loans” (Today, Sep 23).
It states that “The HDB does not have information on bank loans that are in arrears over three months”.
In reply to a question in Parliament in February 2007, it was disclosed that as at the end of 2006, seven per cent of the 89,000 HDB flats with bank loans, were in arrears for more than three months.
Since the HDB was able to give the “in arrears” statistics in 2007, why is it that it does not have the information now?
In this regard, the HDB seems to have a habit of reporting statistics that “disappear”?
For example, the HDB’s Annual Report used to publish the statistic for the number of flat dwellers whose applications for financial assistance (because they could not pay for their HDB flats) were approved.
However, this statistic has “disappeared” since the HDB’s 2005/2006 Annual Report.
This figure was 28,386, 39,308, 25,168 and 16,475, for FY 2004, 2003, 2002, and 2001, respectively.
Of course, it may also have been helpful to publish the statistics on the number of applications that were not approved.
As a concerned citizen who has been volunteering to provide financial counseling for needy and bankrupt Singaporeans for many years, I have encountered countless people who had difficulty in paying for their HDB flats.
Hence, HDB whose mission is to provide affordable public housing for Singaporeans, and being the ultimate owner of all HDB flats when the 99 years lease on HDB flats expire, should not just brush aside my question with “The HDB does not have information on bank loans that are in arrears over three months”.
With about seven per cent of HDB concessionary loans in arrears over three months as of June, at 26,000 out of 393,000 loans, and about 3 in 10 of total HDB loans being HDB bank loans totalling 153,000, surely it is in the public interest to know how many HDB bank loans are in arrears, given that last year was the worst recession in Singapore’s history.
As to “The coverage of HDB’s concessionary loans is very generous by any measure”, I would like to point out that the following categories are not eligible for a HDB loan :-
– permanent residents, taken at least 2 HDB loans, singles scheme earning above $3,000 a month, monthly household income above $8,000, owners of any private residential property (including an HUDC flat / Executive Condominium) in Singapore or overseas, private property owners who sold their property within 30 months of the HDB loan application, own one market / hawker stall or commercial / industrial property and operate the business themselves, own more than one market / hawker stalls or commercial / industrial property in Singapore or overseas, etc
Moreover with the new policy of the HDB reducing the quantum of the second concessionary loan by the full CPF refund and up to half of the cash proceeds from the disposal of the existing or immediate past HDB flat, which could have been many years ago, even more people may not be able to take HDB loans, because they may have utilised their part cash proceeds or CPF for education, retirement, insurance premiums, etc.
Finally, the nearly 2.000 cases of mortgagee sale of HDB flats since banks started giving HDB loans in 2003 may not be truly reflective of the magnitude of the problem, as those who can’t pay, would have been forced to sell in the open market at valuation plus Cash-over-valuation (COV), instead of waiting for a bank mortgagee sale which typically derives much lower sale proceeds near or at valuation.
Leong Sze Hian
