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90% of buyers with LTV ratios above 75% purchased 4-room or larger HDB flats, reveals Desmond Lee

National Development Minister Desmond Lee revealed that nearly 90% of buyers with LTV ratios above 75% purchased 4-room or larger HDB flats, paying S$20,000 to S$60,000 more. He assured that lower-income families would not be impacted by the LTV cut, as the Enhanced CPF Housing Grant would offset the reduction.

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The recent increase in total housing grants for first-timer families purchasing resale Housing and Development Board (HDB) flats has sparked questions regarding its potential impact on resale prices.

People’s Action Party (PAP) MP for West Coast GRC, Ms Foo Mee Har, filed a parliamentary question asking whether the enhanced grants, now amounting to up to S$230,000, could lead to sellers demanding higher prices, knowing buyers have increased financial support.

Additionally, Workers’ Party MP for Sengkang, Mr Chua Kheng Wee Louis, filed parliamentary questions seeking information on loan-to-value (LTV) ratios for first-time homebuyers who have taken HDB loans since 30 September 2022.

He requested details on the number and percentage of loans with LTV ratios at 80%, between 75% and 80%, and below 75%, broken down by flat type. Mr Chua also inquired about the breakdown of the HDB Resale Price Index (RPI) by flat type over the past five years, including the reasons for differences in price growth across flat types.

In his written reply, Minister for National Development Mr Desmond Lee addressed some of these concerns.

He explained that while the Resale Price Index had increased by over 4% in the first half of 2024, MND could not provide detailed RPI figures by flat type due to small transaction volumes and fluctuations in certain categories. Instead, he referred to publicly available data on median resale prices by town and flat type, updated quarterly on the HDB InfoWEB.

Regarding loan-to-value ratios, Mr Lee noted that most homebuyers borrow conservatively, with nearly 90% having LTV ratios below 75%. He added that buyers with LTV ratios above 75% tended to purchase larger flats, such as 4-room and 5-room flats, and paid between S$20,000 and S$60,000 more than those with lower LTV ratios for the same flat types.

Mr Lee highlighted that the recent reduction of the LTV limit from 80% to 75%, effective from August 2024, is intended to promote more prudent borrowing and stabilise the resale market, particularly at the higher end.

Mr Yip Hon Weng, another PAP MP, raised concerns about the potential negative impact of the lower LTV limit on low-income households transitioning from rental housing to home ownership.

In response, Mr Lee assured that lower-income first-timer families would not be disadvantaged, as the increase in the Enhanced CPF Housing Grant (EHG) will more than offset the reduction in loan quantum.

He also acknowledged that a small number of low-income families, including second-timers, may be affected by the lower LTV limit but are not eligible for EHG.

He encouraged them to approach HDB for assistance through support schemes such as the Step-Up CPF Housing Grant and the Fresh Start Housing Scheme.

Mr Lee assured that the EHG is not likely to significantly affect seller pricing, as sellers are unaware of the grant amounts buyers are entitled to.

The EHG and the reduced LTV limit are designed to ensure affordable homeownership while moderating price increases, said Mr Lee, who noted that the government will continue monitoring the housing market and taking necessary action to maintain affordability and stability.

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Parliament

Minister Shanmugam rejects request for detailed information on visa-free visitor offences: Cites bilateral considerations

Minister for Home Affairs K Shanmugam rejected Workers’ Party MP He Ting Ru’s request for detailed statistics on visa-free visitors involved in crimes, citing bilateral concerns. He affirmed current screening measures are sufficient, with no plans for an electronic travel authorisation system.

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On 10 September 2024, Minister for Home Affairs and Law, Mr K Shanmugam, refused to provide detailed information requested by Workers’ Party Member of Parliament (MP) for Sengkang GRC, Ms He Ting Ru, regarding visa-free visitors involved in criminal offences in Singapore.

Ms He had asked for statistics on how many visa-free visitors had been arrested or identified as persons of interest for criminal activities from 2021 to June 2024, along with a breakdown of offences by type, number, and country of origin.

She also queried the consideration of enhanced screening measures and the possibility of introducing an electronic travel authorisation system similar to those in other jurisdictions.

In his written response, Mr Shanmugam stated that with over 150 countries on the visa-free entry list, it would not be practical or meaningful to publish crime statistics specific to visitors from these nations.

He added that doing so could carry bilateral implications and potentially send the wrong message to bona fide visitors from these countries.

Mr Shanmugam affirmed that Singapore’s Immigration & Checkpoints Authority (ICA) employs a risk-based, multi-layered approach to balance border security with traveller facilitation and assured that the current measures are sufficient. He reiterated that there were no immediate plans to implement an electronic travel authorisation regime, as it would increase inconvenience for visitors.

“We are satisfied with the current measures, and for now, do not see a need for an additional electronic travel authorisation regime. Also, such a regime will make visiting Singapore more inconvenient,” said Mr Shanmugam.

This response followed an oral reply delivered earlier that day by Minister of State (MOS) for Home Affairs, Ms Sun Xueling, who addressed a related question posed by Non-Constituency Member of Parliament (NCMP) Mr Leong Mun Wai from the Progress Singapore Party (PSP).

Mr Leong had expressed concerns about the potential rise in crime following the introduction of a 30-day visa exemption arrangement for Chinese nationals in February 2024. He specifically questioned whether the recent burglaries involving foreign syndicates had any link to this exemption and whether automated lanes at Changi Airport increased the risk of non-bona fide travellers entering the country.

Ms Sun refuted Mr Leong’s concerns, clarifying that there had been no increase in arrests among short-term visitors from China since the visa exemption came into effect.

She noted that the arrest rate of Chinese visitors had, in fact, decreased compared to the previous year. While acknowledging the involvement of some foreign nationals in criminal activity, she highlighted that the visa regime alone cannot eliminate all risks. Instead, ICA employs enhanced technology, such as biometrics and advanced data analytics, to screen travellers.

Ms Sun also emphasised the importance of the tourism sector to Singapore’s economy, generating S$27.2 billion in receipts in 2023 and employing over 71,000 workers. She argued that closing borders to prevent crimes would not be a viable solution, especially given Singapore’s competition with neighbouring countries like Malaysia and Thailand, which are also working to attract Chinese visitors.

Despite further calls from Mr Leong for additional security measures and tougher penalties for cross-border crimes, Ms Sun reassured that the government continually reviews its laws, including the Criminal Procedure Code and Penal Code, to address transnational crimes such as human trafficking, drug trafficking, and online scams.

She affirmed that Singapore remains vigilant in adapting its laws and measures to combat evolving criminal trends.

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Leong Mun Wai questions why NTUC leaders often come from the ruling party

During the Platform Workers Bill debate on 10 Sept, Mr Leong Mun Wai, NCMP from the Progress Singapore Party, backed WP MP Gerald Giam’s call for an independent NTUC. He expressed concerns about NTUC’s ties to the ruling party, questioning its independence given that its leaders are often from the PAP.

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SINGAPORE: Mr Leong Mun Wai, Non-Constituency Member of Parliament (NCMP) from the Progress Singapore Party, voiced support for the Workers’ Party and its MP Gerald Giam’s call for an independent and non-partisan NTUC, separate from the ruling People’s Action Party (PAP).

During a parliamentary debate on the Platform Workers Bill on Tuesday (10 Sept), Mr Leong acknowledged that tripartism is a fundamental aspect of governance that all parties, including opposition ones, seek to foster.

He noted that unions naturally seek political power to effect change but expressed concerns about the extent of NTUC’s relationship with the ruling party.

However he questioned the level of NTUC’s independence from the government.

He pointed out that the NTUC’s secretary-general is often a minister or former minister and that many NTUC leaders come from the ruling party.

“Can you find another trade union in the world where the trade union chief is a minister? Are there any countries? Please let me know if there are,” Mr Leong asked, further noting that few opposition politicians are given appointments in NTUC.

“I think we are entitled to think that the independence of NTUC ought to be better than this.”

Earlier, PAP MP Christopher De Souza criticized MP Gerald Giam for using the term “tether” to describe the NTUC-PAP relationship, emphasizing that the NTUC operates through partnership, alliance, and solidarity rather than subordination.

In response, Mr Giam clarified that when he used the terms “tether” or “untether,” he meant that the NTUC and the PAP should be separate and independent organizations.

He sought to ensure that NTUC does not appear to be biased towards the ruling party.

Mr Giam also raised concerns about NTUC’s structure, particularly questioning why the Platform Associations need a Council of Advisors with the power to dismiss the Executive Council and why these advisors are predominantly PAP members or MPs.

He suggested that this structure indicates a lack of independence for NTUC.

The current NTUC secretary-general is Ng Chee Meng, a former PAP minister who assumed the position in 2018 and continues to hold it despite losing to WP’s new team in GE2020.

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