DPM Wong’s remark on BTO flat prices “moving in tandem” with income draws backlash from netizens

DPM Wong’s remark on BTO flat prices “moving in tandem” with income draws backlash from netizens

SINGAPORE — Mr Lawrence Wong, Singapore’s Deputy Prime Minister and Finance Minister has again addressed housing affordability concerns by reassuring Singaporeans that public housing remains accessible and affordable.

He explained, “In Singapore, the Prime Minister has to be a real estate agent, so I’m learning and brushing up my skills and I will use this occasion to practise.”

Responding to worries surrounding the affordability of HDB flats, Mr Wong stated, “BTO flat prices have, in fact, moved in tandem with incomes.”

During his speech at the May Day Rally at Suntec Singapore Convention & Exhibition Centre on 1 May, Mr Wong also mentioned various housing grants available to first-time homebuyers, making flats even more affordable.

He explained that while prices for 4-room Build-to-Order (BTO) flats in non-mature estates have risen nearly ten times since 1980, median household incomes have increased at a similar rate. Additionally, housing grants of up to $80,000 for first-time buyers make flats even more affordable.

Mr Wong emphasized that the typical household today continues to use less than 25% of their income to service housing loans, similar to 1980 levels.

He reassured Singaporeans that the government remains committed to ensuring affordable and accessible public housing, adding that it’s a key part of the social compact in Singapore.

“We have done this in the past. We’ve created the world’s best public housing. You go anywhere in the world: name me any country that has the same quality of public housing that we do – there is none.”

“Now, we are continuing to provide affordable and quality public housing to Singaporeans. And as long as the PAP remains in charge, we will ensure quality public housing that is affordable and accessible for our children and future generations.”

“This is what we stand for. The Government will always strive for a fairer and more equal society, and for the well-being of every worker – that conviction is in our DNA; it’s in the DNA of both the PAP and the NTUC,” said Mr Wong.

Netizens called out DPM Wong’s remark as “irresponsible” 

Upon reviewing the comments on CNA, Mothership, and TODAY‘s Facebook posts, it is clear that most, if not all, netizens do not support Mr Wong’s statements in his May Day speech.

Mr Wong’s speech is being strongly criticised by netizens being a representation of how the 4G team – which he leads – are living in an ivory tower, and have called out Mr Wong’s statement as “irresponsible” and not accurately reflect the reality of housing affordability in Singapore.

A netizen who commented on CNA said that saying that prices have risen in tandem with income is “irresponsible”, given that Singapore is currently experiencing the highest inflation in decades.

“I think we still need a man like LKY telling hard truths, rather than glossing over problems.”

Compare apple with apple?

Certain comments also criticised that comparing the affordability of HDB flats in 1980 to the present day is not entirely fair because there have been changes in loan tenures and household incomes.

Another comment also stated that looking at median income and BTO price alone to determine affordability is oversimplifying the issue.

There are other factors to consider, such as the length of the loan repayment period, the amount of cash or CPF left after servicing the loan, and the need to give up other forms of spending.

“Otherwise, it would be a case of choosing only data that favours the government stance rather than an objective assessment of the reality of BTO price and median household income, ” a netizen wrote.

A netizen noted that it might be helpful to take a holistic approach and consider the net disposable income after accounting for various costs such as housing, food, medical expenses, transportation, education, utilities, and other essential expenses.

This could provide a more accurate assessment of the quality and affordability of living in Singapore.

‘Clearly unaffordable’

Many netizens highlighted that the cost of housing has skyrocketed to a unaffordable level for many.

Comparisons were made to the 1980s, when single-income households were able to service their mortgage loans.

Today, even with dual incomes, many families are still struggling to meet the costs of both housing and daily living expenses.

While some homeowners are grateful to have secured their HDB flats years ago, others have voiced concerns that rising housing costs coupled with slow wage growth could pose difficulties for those who face retrenchment or job loss.

In addition, one comment noted that he would only consider an HDB flat as “affordable” if a family could fully repay the mortgage loan within 15 years using less than 25% of their monthly income. This differs from HDB’s typical 25-year loan repayment period.

‘Tandemto whose income?

As to Mr Wong’s claim that BTO flat prices have moved in tandem with incomes, some netizens have asked him to clarify whose income he was referring to.

Another comment raised doubts about the affordability of BTO flats for those working in jobs such as hawker, taxi driver, waitress, nurse, clerk, or technician, as the vast majority earn less than $4,000.

One netizen shared that his annual income ranges from $200k to $500k, and he has noticed that BTO flat prices have increased significantly while the sizes of the flats have decreased drastically.

‘Future PM is disconnected’

The comments from Lawrence Wong, who was appointed DPM in 2022 and is slated to succeed Prime Minister Lee Hsien Loong, raised doubts about his capability among some netizens.

They suggest that the “future PM” seems to be disconnected from the grassroots level or is attempting to downplay the housing issue for the sake of an election.

Opposition parties called for reviewing HDB affordability while PAP Minister defends current housing policy

The housing prices have risen significantly in recent years, and the government had to implement several cooling measures in December 2021 and September 2022, to moderate demand in the property market.

Not long ago, A 5-room resale flat on the 41st floor of Pinnacle@Duxton was sold at S$1.4 million, breaking the previous record of S$1,388,888.88 set in March last year, leave ordinary Singaporeans in shock.

Singapore government has to announce the implementation of increased Additional Buyer’s Stamp Duty (ABSD) rates effective from 27 April as a measure to “promote a sustainable property market” and “prioritise housing for owner-occupation”.

Foreigners buying any residential property in Singapore will see an ABSD raise from 30% to 60%.

Although opposition Members of Parliaments have earlier voiced concerns over the surging price of HDB flats, which would price them out of reach for many ordinary Singaporeans, Minister for National Development Desmond Lee has rejected the Progress Singapore Party (PSP)’s proposal to reset the current housing price, insisted that close to 70 per cent of Build-To-Order flats are affordable with S$8,400 median household income and that resale prices.

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