Tuesday 7 May 2013

Govt goes flat out to meet housing needs

By Daryl Chin, The Straits Times, 6 May 2013

TO WED or not to wed, and then whether to have children, are lifestyle choices.

So is it really fair to give couples priority in the public housing queue simply because they choose to get married and procreate?

After all, even without any leap-frogging, there are options. Renting, though expensive, is one, as is the prospect of squeezing in with in-laws.

Besides, the income ceiling has already been raised - from $8,000 to $10,000 - two years ago to offer more citizens subsidised housing.

Considering there are about 15,000 marriages each year, and that the Housing Board plans to launch about 25,000 new flats annually, plus another 110,000 flats to be completed between now and 2016, a waiting period of a few years is not particularly unreasonable.

Indeed, the HDB has launched flats in record numbers in the past two years. It has released about 70,000 new flats since 2011, compared to the 13,500 flats offered in 2009, and assurances have been given that there are enough new flats for all first-time buyers.

So if the discussion is about home ownership rather than the speed at which one is obtained, the 2012 rate of 90 per cent - a meteoric rise from 1970's 29 per cent - is nothing to be sniffed at. Of these homes owned, about 80 per cent are HDB flats.

This rate is one of the highest in the world, and far ahead of similarly dense populations; in Japan, 61 per cent own homes, while in Hong Kong, that rate is 52 per cent.

Still, it is the waiting time for a flat that remains a bugbear; a national issue, in fact.

With Singapore's total fertility rate (TFR) at 1.2, far below its ideal of 2.1, offering homes to young couples sooner has become arguably the most major incentive to boost the country's low birth rate. (Incidentally, the TFR in Japan is 1.36, while in Hong Kong, it is 1.1.)

Other, non-housing related measures such as baby bonuses have been in place for more than a decade, and yet the TFR has been dropping steadily.

The last time it was above 2.1 was in 1976. Last year, the National Population and Talent Division found the main reasons behind the low fertility rate are more people choosing to remain single, or marry later, and married couples having their first child later.

With the Housing Board's fresh arsenal of measures to provide support for citizens with families, or thinking of starting one, the hope is that the TFR could be coaxed to 1.5, adding about 9,000 babies annually to the average figure of 36,000 per year.

The Parenthood Priority Scheme, for one thing, sets aside 30 per cent of new Build-To-Order flats for couples who have started families before getting their flats. This group also gets as many as half of the balance flats pushed out. Such flats are highly coveted as they are already built or close to completion.

Qualifiers for this scheme must be first-time applicants, meaning they have yet to receive a housing subsidy, and their child must be younger than 16.

During the March Budget debate, the scheme was extended to include pregnant mothers after calls from MPs such as Mr Seah Kian Peng (Marine Parade GRC).

National Development Minister Khaw Boon Wan, in responding to queries from others including Mr Gerald Giam from the Workers' Party, added that married couples without children would also get some form of priority, hopefully by next year.

The rationale, he said, came down to this: "I think we should try to give flats to first-timers in the following order - those already married with children, those married without children, and those not yet married. This is the priority which I think is fair."

His comments underscore a key tenet of the Housing Board, that is, to build cohesive communities and support national objectives, such as arresting the country's falling birth rate.

Towards that aim, the amount spent on pro-family efforts has risen from $1.6 billion a year to $2 billion. Other measures contributing to the cost include bigger baby bonuses, new health-care coverage for tots and fertility treatment subsidies.

Observers are split on whether a quicker distribution of housing for young couples will lead to more babies being born, or even be a step in the right direction for that matter.

"The basic premise is that no citizen should be denied public housing," said Associate Professor Paulin Straughan, a sociologist, "but since Singapore leverages on public housing to frame family ideology, policies tend to favour those that are willing to procreate to set the tone."

While attempts to address the housing shortage and fertility rates are to be lauded, she noted that there are many who fall outside the bracket of help, or do not conform to the status quo.

"To be clear, this means Singaporeans who are single not by choice. Those that just cannot find a significant other, no matter how many policies are rolled out," she said.

And, for those whose lifestyle choices do not include children or marriage, the measures do not sit well.

After all, the perception that having an HDB flat is a birthright for Singaporeans has its roots as far back as half a century ago, when the agency first started.

Former prime minister Lee Kuan Yew was successful in using high home ownership rates as a way to build a national identity amid a volatile era, so much so that this has formed part of the national psyche.

So while much is being done to further a national cause, some feel left out - such as bank officer James Chua, 27.

"The playing field should be level for all citizens, regardless of life choices. Are my contributions to society lesser simply because I do not want to start a family?" he asked.

To that, Prof Straughan asked: "What about the needs of the nation? At the end of the day, state policy also has to look after stability and growth. The long-term consequences outweigh the notion of fairness."

There are also those who agree that those starting families have pressing housing needs.

National University of Singapore economist Tilak Abeysinghe said last year that there was a distinct correlation between housing affordability and fertility.

Once home prices go out of reach, couples have to wait longer to secure a house, and this may come at the expense of family size, he noted.

Still, the situation could be much worse.

As Mr Paul Yip, a professor of social work and social administration at the University of Hong Kong, pointed out in a February report in the South China Morning Post: "The Singaporean method has been criticised as unhelpful, given that its fertility rate still remains low. But it would probably be even lower without these measures."




THE SINGAPORE PERSPECTIVE
Who should get priority for a flat?
By Daryl Chin, The Straits Times, 6 May 2013

DESPITE a ramping up of public housing supply, demand for new flats, particularly in choice locations, is still strong. How, then, does the Government decide who should be more deserving?

The new measures to help married couples with or expecting children are to correct an imbalance in the balloting process, said National Development Minister Khaw Boon Wan. This is done by setting aside flats specifically for them.

He revealed earlier this year that couples who have yet to marry, or have applied for new flats under the fiance-fiancee scheme, make up more than half of first-time applicants.

Married couples without children, and those who had them, constituted 25 per cent and 20 per cent respectively. Mr Khaw felt that this group of married couples has greater need for a flat, yet has a smaller probability of landing one as there are many applicants on the fiance-fiancee scheme.

Previously, balloting chances were decided by whether applicants had or had not previously enjoyed a housing subsidy.

This method of determining need began at the inception of the Housing Board's Build-To-Order system in 2001.

Then, 85 per cent of new flats were set aside for first-timers, in order for the HDB to achieve its overaching social mission of home ownership.

This increased to 90 per cent in 2007, and 95 per cent just two years later. As a result, Singapore enjoys one of the highest home ownership rates in the world.

During this time, another family-centric scheme had also been in force. The Third Child Priority scheme was introduced in 1987, and set aside just 5 per cent of new flats if the third child was a Singaporean.

But more drastic measures were taken earlier this year, in a bid to encourage couples to have children earlier, and to stem the falling birth rate.

The Parenthood Priority Scheme sets aside 30 per cent to 50 per cent of new flats for first-timer couples who have young children or are expecting one.

Demand was strong in the scheme's first outing in January.

In that BTO exercise, couples with young children met the quota for flats in non-mature estates, and exceeded it by about two times in mature ones.

But it is not just married couples that the Government has to look out for.

As Singapore progressed, and its population grew more savvy and distinct, the housing needs of other groups had to be addressed.

Demand had ratcheted up due to a slowdown in construction a decade earlier, which was itself a reaction to a period of overbuilding in the 1990s.

Between 2001 and 2008 for instance, the HDB constructed only about 8,000 new units per year. At present, it is pumping out flats in record numbers to tackle the shortage.


Singles, for instance, would be able to apply for new flats for the first time in July this year, although they would be restricted to two-roomers and must earn no more than $5,000. Divorcees and second-timers were also given higher quotas for new flats earlier this year.

With so many clamouring for new flats, is the priority for young couples enough to lure them into making babies?

While it is too early to tell, one thing is for sure. Housing, like quality of life and cost of living, is but one component in an equation that is growing more complex by the day.


This is the sixth of 12 primers on various current affairs issues, which will be published in the run-up to The Straits Times-Ministry of Education National Current Affairs Quiz.


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