To prevent foreign enclaves from forming in HDB estates, the Housing and Development Board (HDB) will introduce a new quota for permanent resident (PR) families buying resale flats, Mah Bow Tan, Minister for National Development said on Friday.

Mr Mah said even though PR enclaves are not a problem today, precautionary measures should be put in place early.

PRs will be subject to quotas of 5 per cent and 8 per cent at the neighbourhood and block levels respectively.

A PR family cannot buy a flat if the neighbourhood or block already has 5 per cent or 8 per cent of flats owned by other PR-PR families.

The quota will only apply to non-Malaysian PRs. Malaysians are excluded, because of Singapore’s close historical and cultural links.

In 2009, PRs make up 14 per cent of Singapore’s resident population. But PR families own only 5 per cent of HDB flats.

Source: Business Times, 5 Mar 2010

There is no evidence that specific buyer groups, like permanent residents (PRs) and private property owners (PPOs) are driving up prices of HDB flats.

National Development Minister Mah Bow Tan told Parliament on Friday that the median cash-over-value (COV) paid by PRs have been the same as the overall median COV paid for resale flats for the last two quarters.

‘Cases of PRs paying high COV are the exception, not the rule,’ Mr Mah said.

He said of the 37,205 resale transactions in 2009, 58 cases had COV exceeding $70,000 (US$49,995).

Of this, only eight cases or 14 per cent involved PRs.

Mr Mah added while PPOs pay higher COVs in general, their numbers are not large enough to drive up prices.

‘If we banned PPOs from buying HDB resale flats, what about HDB owners buying private properties? Should we ban that too?’ he asked.

‘I would urge that we take a longer-term view and not over-react, and do things we regret and have to reverse down the road.’

Source: Business Times, 5 Mar 2010

National Development Minister Mah Bow Tan announced in Parliament on Friday changes in housing policy to promote citizenship in HDB households and encourage social integration.

To promote citizenship and reinforce the privilege that comes with it, households comprising one Singapore Citizen and one Permanent Resident (PR) will have their CPF Housing Grant reduced by S$10,000 when buying a resale flat. This will also apply to Design, Build and Sell Scheme flats and Executive Condominiums.

Should such households opt for a new flat, they will have to pay a 10,000-dollar premium on top of HDB’s selling price.

Previously, PRs married to Singapore Citizens enjoyed the same subsidies as Singaporean couples. However, HDB will restore the S$10,000 should the PR family member take up citizenship, or if the couple has a child who is Singaporean.

Furthermore, in Parliament on Friday, Members of Parliament (MPs) aired concerns over PR enclaves.

Christopher de Souza, MP, Holland-Bukit Timah GRC said: “It is natural that people feel comfortable with their own kind, from similar backgrounds and culture. However, this could lead to a situation where integration within the Singaporean community is delayed or hampered.”

In response, Mr Mah said on top of fulfilling ethnic quotas under the Ethnic Integration Policy, non-Malaysian PRs will be subject to an additional quota, at 8 per cent at the block level, and 5 per cent at the neighbourhood level. HDB said Malaysian PRs are excluded because of close historical and cultural links.

Mr Mah said: “PR enclaves are not a problem today, but as always, we try to look ahead. And if we see the trend, we should put precautionary measures in place early. Otherwise, it may be too late when the problem is already there, and you have to unravel the problem later.

“It is important that PRs integrate well in our local communities as they are long-term residents of Singapore.”

The Ethnic Integration Policy will also be revised for Indians and other ethnic races living in HDB estates. At the neighbourhood level, their quota will go up from 10 per cent to 12 per cent. At the block level, it will be 15 per cent from the current 13 per cent.

There will be no change to the ethnic quotas for Chinese and Malays. For Chinese, it is 84 per cent at the neighbourhood level and 87 per cent at the block level. For Malays, it is 22 per cent at the neighbourhood level and 25 per cent at the block level.

Source: Channel News Asia, 5 Mar 2010

DPM Wong allays concerns about influx of immigrants

THE Government hears and understands Singaporeans’ concerns about the influx of immigrants in recent years, Deputy Prime Minister Wong Kan Seng said yesterday.

So it has refined the requirements for permanent residents (PRs) and new citizens, even as it continues to take them in to top up Singapore’s declining population, he told Parliament.

As one indication, there were 59,500 new PRs last year, down from 79,200 in 2008, and 19,900 new citizens, compared to 20,500 a year ago.

‘I know that this is a matter which Singaporeans care deeply about, and rightly so, as it concerns the value of our citizenship,’ he said.

‘We will ensure that those who become one of us are of suitable quality, and not only contribute to Singapore economically but also integrate well into our society,’ he added.

Mr Wong, who is also Home Affairs Minister and oversees population issues, spoke during the debate on his ministry’s plans for the coming financial year.

Eight MPs voiced concerns about the recent surge in foreigners – one in three people in Singapore is now foreign-born – and sought updates on policies to integrate newcomers.

Six months ago, Prime Minister Lee Hsien Loong first voiced understanding of Singaporeans’ concerns, and promised to sharpen distinctions between citizens and non-citizens.

Since then, the Government has increased fees for non-citizens in schools, polytechnics and institutes of technical education, as well as giving citizens double the chances of PRs when it comes to school balloting at Primary1.

In health care, subsidies for citizens will be raised further, thus widening the gap with PRs.

Yesterday, Mr Wong said that while the Government continues to welcome ‘good quality’ PRs, Singaporeans come first in their own country.

‘No need to worry about this,’ he declared.

But distinctions must be sensible and balanced, and not undermine the principle of meritocracy which makes Singapore competitive and draws foreigners to sink roots here.

He emphasised the distinction between ‘transient’ foreigners who form a quarter of the five million people here, and resident ones who become PRs and citizens. Transients leave when their work permits or employment passes expire.

While Singaporeans may be frustrated and annoyed at sharing common spaces with people of different social habits and reflexes, the Government is taking action to educate foreigners on social norms here, said Mr Wong.

He added: ‘I acknowledge that there are also those on employment passes holding jobs that Singaporeans are willing to do, and who compete directly with Singaporeans. However, if we want to compete globally, we have to create an environment which can attract the best people, including those who are mid-level – be they Singaporeans or foreigners.’

The number of new PRs minted each year rose from 32,000 in 2003 to 63,000 in 2007, which works out to an average of 48,300 a year over that five-year period.

Explaining the surge, Mr Wong said the Government took advantage of the strong economy in the mid-2000s to attract and retain suitable foreigners to sink roots here to make up for Singapore’s low birth rate. It recently reviewed its framework for assessing PRs and citizens, and will tighten it further.

But he rejected an absolute cap on the numbers, saying: ‘There may be events which trigger an unexpected surge in numbers, which we should take advantage of.’

Mr Wong also explained why Singapore needs to have new citizens each year: ‘If our total fertility rate remains the same, and we do not allow immigrants to settle here, our resident population will start to shrink as early as 2025 because deaths will outstrip births.’

To replenish the current resident pool, Singapore needs 60,000 new babies a year. But there were only 37,000 local newborn babies last year, and despite numerous procreation incentives, the number does not promise to increase by much, he observed.

Hence the need to top up with about 20,000 new citizens each year, to ensure citizens form the core of the population.

Appealing to Singaporeans to be realistic about the need for immigrants, he said: ‘We are all descendants of immigrants.

‘Singapore grew and prospered since its founding because our great-grandparents, grandparents and parents were allowed to come and settle to make a better life and in the process, to contribute to Singapore’s growth.

‘Had they been denied the opportunity to do so at the right time, we would not have been born here and Singapore would not be what it is today.’

Source: Straits Times, 5 Mar 2010

We refer to Ms Josephine Chia’s letter, ‘Single PR can’t buy resale HDB flat’ (Feb7), and Ms Teo Wai Lee’s letter last Sunday, ‘Single PRs and HDB flats’.

The needs of Singaporeans always come first. Permanent residents (PRs) who are singles are not eligible to buy an HDB flat alone under the Single Singapore Citizen scheme. They could consider other housing options, such as buying or renting private properties, renting a room or a whole HDB flat, or staying with their friends or relatives.

In Ms Chia’s case, since her sons are Singapore citizens, she can buy an HDB flat together with either or both of them, if they meet the eligibility conditions collectively.

Lily Chan-Wong Jee Choo (Mrs)
Deputy Director (Policy and Property)
Housing & Development Board

Source: Sunday Times, 21 Feb 2010

PERMANENT residents (PRs) may buy one in five, or 20 per cent, of HDB resale flats today but the latest figures available indicate they form a far smaller minority of the HDB resident population.

Findings of the HDB’s 2008 Sample Household Survey released yesterday showed that PRs made up 8 per cent of the total 2.92 million residents living in HDB flats in 2008.

Non-PR foreigners make up another 4 per cent, which means almost nine in 10, or 88 per cent, of HDB residents were still Singaporeans.

Foreigners and PRs have been singled out recently by disgruntled buyers priced out of the market as possible reasons for the sky-high demand that has pushed HDB resale flat prices to record levels.

But the numbers, the latest available, show that PRs and foreigners are not likely to cause significant increases in flat prices, said Associate Professor Sing Tien Foo of the National University of Singapore’s real estate department.

Still, to address concerns, the HDB said recently it is considering introducing a separate ethnic quota for PRs to prevent them from forming enclaves in public housing estates – but details are not available yet.

Source: Straits Times, 19 Feb 2010

I REFER to the letters by Mr Lua Eng Chuan (‘Ban PRs from reselling HDB flats at a profit’, Jan 19), Mr Wan Siew Kay (‘Citizenship caveat’, Jan 20) and Mr Robin Chua (‘Costly flats’, Jan 27).

In response to recent strong demand, the HDB has already ramped up the supply of new flats. With at least one build- to-order (BTO) launch a month, most first-time buyers can expect to select a BTO flat within two tries, and move into their new flats three years after booking.

The HDB is monitoring the demand situation closely and will increase the supply of new flats further, if necessary.

The oversubscription for BTO launches does not mean the flat supply is inadequate. In fact, many flat buyers do not select a flat when they get the chance. Last year, almost 50 per cent of first-time applicants in BTO launches did not select a flat upon invitation. So it is not true that there is inadequate supply of new flats, as suggested by Mr Chua.

We also wish to correct some misperceptions about permanent residents (PRs). PRs do not enjoy housing subsidies or HDB concessionary loans. Citizens make up 95 per cent of flat owners and 80 per cent of resale flat buyers.

Mr Wan may have confused HDB’s public rental flats with flats rented out by lessees at open market rentals. The former is meant only for needy Singaporeans who have no other housing options. PRs must rent a flat from the open market at full market rates.

Mr Lua suggested banning PRs from sub-letting or selling their flats at a profit. Like Singaporeans, PR flat owners are required to fulfil the minimum occupation period before they are allowed to sublet or sell their flats. They bear the market risks for their purchases. Nonetheless, the HDB is looking into whether our rules have inadvertently allowed flat purchases for speculative purposes.

Singaporean singles also enjoy subsidies to buy an HDB flat, albeit less than citizen households. Singles above 35 can buy a resale flat with up to $20,000 housing grant if their parents are staying with them.

Lily Chan-Wong Jee Choo (Mrs)
Deputy Director (Policy and Property)
Housing & Development Board

Source: Straits Times, 10 Feb 2010

I refer to last Sunday’s sidebar, ‘What properties can PRs buy?’, alongside the article on what permanent residents look for when buying resale flats (‘When PRs buy HDB resale flats, key considerations are cost, location’).

The sidebar stated that ‘PRs are allowed to buy resale HDB flats – but not new flats – without housing and mortgage subsidies’.

This is not entirely true.

Single Singaporeans over the age of 35 are allowed to buy resale HDB flats, but a single PR cannot do so.

I have appealed against this ruling for the last year or so, but have been unsuccessful.

I am nearly 59 and divorced, but am contributing to Singapore by teaching English and creative writing. I was born and raised in Singapore and was a citizen.

Nearly 30 years ago, I married an Englishman, and later took up British citizenship. I did so not because I was disloyal to Singapore, but because Singapore did not permit dual citizenship.

Five years ago, I divorced my husband. I have two sons who have served national service and retained their Singapore citizenship. They now live here.

I decided to come back to Singapore to live when my grandchildren were born. My sons managed to help me get PR status here.

I applied for an HDB flat as I could not afford a private apartment. I went to see the Housing Board, but my application was rejected. This year, I made an appeal and it was rejected too. So I have to stay with my family when I am in Singapore.

I understand the need for stringent housing rules so that people do not abuse the system, but I feel that some cases have to be reviewed with humanity.

Josephine Chia (Ms)

Source: Sunday Times, 7 Feb 2010

The Government has no restrictions on permanent residents when it comes to buying, selling and sub-letting condominium units. But there are rules for landed property and HDB flats.

To buy landed property – bungalow, semi-detached house, terrace house and town house, whether freehold or leasehold – PRs need to apply for a permit from the Singapore Land Authority (SLA). They will be assessed on their economic contributions – qualifications, expertise and investments here.

PRs cannot sell their landed property within three years of buying it. After three years, they may sell it to a Singaporean or another PR, who has to seek SLA’s permission for the purchase. PR owners of landed properties are also not allowed to rent them out under the Residential Property Act. Offenders are liable to a maximum fine of $5,000 or a jail term capped at three years, or both.

PRs are allowed to buy resale HDB flats – but not new flats – without housing and mortgage subsidies.

Resale HDB flats bought without a CPF housing grant and with a bank loan can be sold one year from the date of purchase. To sub-let the whole flat, the PR must have lived in it for three years.

Owners of HDB flats are allowed to sub-let rooms if they own a three-room or bigger flat. There is no minimum occupation period for renting out rooms. Owners have to adhere to the number of tenants allowed by the HDB.

No prior approval from HDB is required for the sub-letting of rooms. But with effect from tomorrow, flat owners who sub-let rooms have to register with the HDB within seven days of doing so.

This applies to all, not just PRs. Those who illegally sub-let entire flats may have their units taken back by the HDB or may have to pay a fine of $1,000 to $21,000.

Source: Sunday Times, 31 Jan 2010

Singapore’s housing authority said Permanent Residents may soon be subjected to a similar ethnic integration policy already imposed on citizens who buy public flats.

Observers say the move is reflective of Singapore’s changing demographics, where about a third of the population are foreigners.

But there’s already a racial quota for PRs in the purchase of public housing.

A shopping centre in Boon Lay in western Singapore gives an idea of the community it serves. It is filled with facilities for its foreign clientele including remittance units, money changers and provision shops catering to Thai and Myanmar nationals.

Tending one of the shops is a 52-year-old from Myanmar who has been living in Singapore for 15 years.

Like many PRs, Madam Yin Yin Winn, who peppers her sentences with the colloquial term “la” considers Singapore home.

In fact, she made several Singaporean friends while volunteering at her daughters’ school.

Madam Winn says her daughters, aged 19 and 16, go to neighbourhood schools.

“When I go to my daughter’s school, I talk with them, sometimes I bring our traditional food, they enjoy my food,” she said.

Like most Singaporeans, Madam Winn lives in a subsidised public flat, which is also subjected to an Ethnic Integration Policy (EIP).

Prior to the 1960s, various immigrant ethnic groups were concentrated in different parts of Singapore creating enclaves. So the Government introduced the Ethnic Integration Policy. This is where public housing is used as a tool to integrate Singapore’s multi-ethnic population.

The EIP is applicable to the purchase of new flats, resale flats, SERS (Selective En-bloc Redevelopment Scheme) replacement flats and DBSS (Design, Build & Sell Scheme) flats, as well as the allocation of rental flats in all HDB estates.

Under the policy, maximum proportions are set for all ethnic groups – Chinese, Malays, Indians and others, in each HDB block and neighbourhood.

There is no restriction on the sale and purchase of an HDB flat if the proportion of the buyer’s ethnic group is within the prescribed block and neighbourhood limits.

Once the block/neighbourhood limit for a particular ethnic group has been reached, no further sale of HDB flats to that ethnic group will be allowed, if it will lead to an increase of the proportion beyond the limit.

There is no restriction if the buyer and seller are of the same ethnic group.

Currently, PRs are already subjected to the policy according to their race.

For example a China national may fall under the ‘Chinese’ category and an Indian national under ‘Indian’.

What could change is expanding it to account for the immigrant’s nationality.

Mr Eugene Tan, Assistant Professor at the School of Law at the Singapore Management University, said: “The fear is that Permanent Residents are forming enclaves of Permanent Residents. What it would mean is that Permanent Residents could be subjected to two types of quotas. One is the original ethnic integration quota, and the other one could be a citizen/Permanent Resident quota.”

Mr Azhar Ghani, a Research Fellow at the Institute of Policy Studies, questions how an ethnic integration policy will affect Malaysian PRs.

“Malaysian PRs, whom I would say are quite acculturalised to our ways, who will face a new restriction to where they can buy HDB flats. This proposed change will just add another additional layer to the EIP categorisation, and current technology would mean that it would not be too big a challenge administratively to ensure adherence,” he said.

“So will PRs who have been here for many years but have not taken up citizenship for whatever reasons, be subjected to the new PR-related rule, in addition to the race quota, when they buy a HDB flat? Should there be a time-bar? For example, will the rule apply only to PRs who have been here for less than, say, five years?,” he asked.

The first indication that the Government is looking into the integration of foreigners within Singapore’s housing estates was revealed by National Development Minister Mah Bow Tan in Parliament in November 2009.

He said the Government “will keep a close watch on the distribution of PRs living in HDB estates and where necessary, consider measures to prevent the congregation of PRs and foreigner.”

Currently, PRs form only 5 percent of HDB households.

And housing analysts say that’s unlikely to create any surge in home prices.

Mr Eugene Lim, Associate Director of ERA Asia Pacific, said: “No issue, it’s just like the current ethnic integration policy, doesn’t affect re-sale prices because the number of PRs who would be buying flats are still there. It’s just “Oh, if I cannot buy this block, I buy another block.””

“I think some people are under the impression that PRs are driving up the prices. It is not, it’s the whole market, that there’s a lot of people buying flats that’s together driving up the price.” Mr Lim said.

“Actually if you look by and large, the PRs, if they do congregate – actually they are all over the place – they are very practical group of people. They buy where they can afford. They buy where they need to stay near to, for example, a place of work or school.

“But because to them, if they feel a fellow countryman is staying nearby, they do build a community. So there’s this issue of – what if there are too many of them staying at a certain place? So it’s really looking forward, if we have more and more PRs coming, how do we then have a ratio to ensure they are spread out in Singapore?” Mr Lim asked.

Still, observers say even with an ethnic integration policy in place, the true test is in the community bonds forged between citizens and immigrants.

Source: Channel News Asia, 29 Jan 2010