Ignore what she misunderstood from the stuff reported in the media, he wrote. What he told Parliament, Khaw said, was that there had been many calls for HDB to “return to basics”, for example to “return to the past when flats could only be sold to HDB, and not in the open market”. Such a call would have major impact on existing flat owners like the lady in question.
Next he segued on to confirm that he does plan to see how they can come up with a new housing option which can be a lot cheaper than today’s BTO price. Meaning new flats that are priced at a level equivalent to 4 years of median household income e.g. a household with gross income of $4,100 should be able to buy a 4-room flat for $196,800 instead of the $300,000 price tag per last quarter's BTO offering. Assuming 30 percent of income used to service the mortgage, one can look forward to 12+ instead of horrendous 30 year housing loans.
Naturally, the new low-cost housing option must come with restrictions, and the minister mentioned some such restrictions as proposed by fellow MPs: longer minimum occupation period, shorter lease and disbarment from resale in the open market. Obviously, as Khaw pointed out, such an option will only apply to the new buyers, and will not apply to existing flat ownerslike the Queenstown lady.
So why did Khaw assure her that her dream (realise her retirement fund by flipping her flat for a fat profit) is safe, congratulate her on "how the HDB policies have benefited her", and that she could now look forward to a new BTO flat? That would only be possible if the new buyers are daft enough to reject the lower priced new flats and opt for the higher priced old flats. Or she downgrades from a 4-room $300,000 flat to a 2-room $100,000 shoebox. Khaw seems to think one can have the pie and still eat it. He seems to have two sets of stories: one for those struggling to afford a fixed roof, and another for those with second properties to sell or to rent.
HDB data indicates that 14,600 whole flats approved for subletting in 2Q2007 have tripled to 43,508 in 4Q2012. This is one bubble that should be burst. The poor ones seem to be subsidising the better off. If the minister thinks the inequity is tenable, he must still be in dreamland.
