Property is an emotional issue in Singapore. I mean when a group of guys in Singapore get together, inevitably something about property will worm its way into the talk. That’s how important property is in Singapore, and it’s so important in Singapore that Singaporeans are willing to put yourself in debt for the next 20 to 30 years just to buy a flat in Singapore.
However in recent times, even that might not be enough. Anyone who read this blog before knows that high property prices are a bugbear of the Singapore government and government ministers have been lining up talking up the “affordability” of homes in Singapore. In the previous months, it was National Development Minister Mah Bow Tan, then Senior Minister Goh Chok Tong, now the latest to step up to the plate is Minister Mentor Lee Kuan Yew.
Minister Mentor Lee Kuan Yew said that public flats will continue to appreciate in value as long as the Singapore economy continues to grow and if the country is doing well, property prices go up. However when the Singapore economy go down, unemployment will go up but incomes and property prices will decline. You know the Singapore government has a problem on its hand when even the Minister Mentor has to talk about the prices of property in public.
With a general election coming up, the government is doing all it can to talk up the “affordability” of homes in Singapore. It’s no surprise because public anger about the prices is widely expected to be a hot topic in the election. MM Lee probably has this in mind because he was speaking while launching The Pinnacle@Duxton, a 50 storey HDB development in Singapore.
Now let’s ignore the less than correct assessment that when the Singapore economy go down, property prices will decline (didn’t really happen in the recession) and focus on the more important aspect of what MM Lee said. That housing prices will continue to go up (because the economy will do well), but prices are affordable to Singaporeans.
As I said earlier, high property prices are a bugbear of the Singapore government and there is public anger about property prices in Singapore. Now MM Lee is considered a sage here in the region (and with his track record, he deserved it) but even he has a task on his hands if he want to convince Singaporeans that property prices are affordable. The Singapore government really needs to stop with this line of argument. Singaporeans are angry about the housing prices now, and you go say that housing prices will continue to go up, but prices will still be affordable?
I’m sorry but talk like that will just get Singaporeans even more pissed off than they are now. Right now, Singaporeans are already 20-30 years housing loan so what’s next? 30-40 years housing loans? And they still would be affordable? Seriously, does anyone know of anyone else who would willingly put themselves in debt for 20-30 years if they can help it?
The fact that Singaporeans are taking such long-term loans on their houses shows the “affordability” of homes in Singapore. Isn’t saying “housing prices will continue to go up, but it is still affordable” adding fuel to fire? It is and if the Singapore government continues with this line to defend the housing prices, then we will be in for interesting election next year.