a solution to HDB

The current high prices of the HDB flats have priced out many young couples who have in turn delayed marriage contributing the falling birth rate. Retirement is also in jeopardy for many as too much CPF funds have gone into housing. The government has came out of its denial mode and stopped its fallacious defense of high property prices and starting to acknowledge the problem. The PAP solution can be simplified in the following:

1) Ramp up housing supplies through construction
2) Decrease mortgage loan period and loan amount
3) Subsidizing young citizen couples
4) Lessen profits made from resale flats by mandating sellers who do not meet the CPF Minimum Sum and do not pledge their CPF into the house they own, to pay CPF back an amount up to the Minimum Sum with interests
5) Scrapping Design, Build, Sell Scheme

Despite the policy changes above to curb speculation and bring down the prices of HDB flats, the resale flat index continues to climb as demand for housing by the increasing population remains strong. The Singapore Democratic Party instead proposed a new framework that introduces a mixture of Open Market(OM) flats and Non-Open Market(NOM) flats. Again, simply put in:

1) NOM flats wil be bought and sold at cost price, through removing land costs, solely from and to the HDB, and solely opened to Singaporeans
2) OM flats will be what the present resale market is

We have 2 extremes here which have its own course of unique problems. The PAP one will render more Singaporeans homeless when less credit are available if the housing prices continue to rise. The SDP one will upset the housing market as no Singaporean would go for OM flats and BTO flats with a price difference to that of NOM at least of $100K. Housing prices would tank too fast and existing homeowners who have already took up massive loans will be ones ensuring this rule doesnt happen. Like medicines, one is ineffectual, while the other is too strong. A moderate solution is to live with the existing framework and introduce some fundamental tweaks:

1) Ban Cash over Valuation(COV). It worked for the hawker stalls, which were seeing increasing rental before National Environment Agency banned COV for transactions. This of course will affect the commissions of the property agents, but it is time common sense prevail over greed.
2) Nationalize all HDB valuators. Control the resale market strictly through the freezing of valuation by using a transparent housing index that tables which amenity justifies how much premium
3) Regulate Singapore Banks and ban refinancing
4) Ban pledging of CPF into housing
5) Increase Minimum Occupancy Period to 10 years
6) Bring down Singapore’s population
7) Creation of open market hostels for work permit holders and S Pass holders
8) Bring down the number of PRs by issuing an ultimatum by offering citizenship or voiding the PR status after 15 years of permanent residence

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