Govt should fine-tune its message encouraging home ownership
By Sue-Ann Chia
PRIME Minister Lee Hsien Loong's recent remarks about the emergence of fake online campaigns to pressure the Government were intriguing.
Referring to recent e-mail messages calling on the Government to cool the property market, failing which the writers threatened to withdraw support from the ruling party, he described the phenomenon as 'astroturfing'.
The term, derived from a brand of fake grass, comes from the United States where it refers to a fake grassroots movement which manufactures support or opposition to certain policies or issues.
Why fake? Because a number of the purported e-mail writers were found to be non-existent. The conclusion is that one, or at most a handful of people, could be behind the deluge of e-mail messages sent.
Mr Lee's comments have led some to wonder if the Government is concluding that, because some writers are fake, the concern on the ground over property prices is likewise not as strong as made out to be in the e-mail messages.
I hope not. Whether the e-mail messages were sent by real or fake people, there is real unhappiness on the ground over soaring housing prices. That unhappiness should not be discounted.
To be sure, there is no hard data on exactly how many people are unhappy. Some may argue that those who are unhappy are but a small group, only very vocal.
Anecdotally, a number of those who are angry are young, upwardly-mobile professionals earning incomes in the mid-levels. They desire strongly to buy a dream home - but find their dream fading as prices have escalated in recent months.
Middle-class families who have been saving up to upgrade to a bigger home in a better location could be experiencing similar unhappiness, as higher property prices force them to rethink the move.
Add the recent surge in the number of foreigners in Singapore, and the result is even greater resentment as foreigners are blamed for driving up demand and prices.
What exactly is the root cause of the unhappiness? Is it affordability of housing, unrealistic expectations, or a growing disenchantment as the Singapore Dream slips away?
Many Singaporeans have latched on to the first reason, blaming the Government for letting home prices become too high.
The Government, on its part, has countered by arguing that complainants are being unrealistic.
It points out that it has taken steps to cool the property market, such as by curbing the deferred payment scheme for private property and increasing the minimum occupation period for HDB flats.
It has also explained repeatedly that most flats are not priced beyond reach, and that those who want one should be able to get a flat if they are less fastidious about location.
National Development Minister Mah Bow Tan, in a recent interview with The Straits Times, cited people's unrealistic expectations as a cause of the angst.
People want a nice flat, in a nice location, with a nice view and at a nice price, but that is just not possible, he said.
Making a case that affordability is not an issue, he also gave statistics to show that the prices of resale flats have not outpaced household incomes in the 10 years from 1999 to last year.
Are Singaporeans convinced? It remains to be seen.
Reform Party member Hazel Poa, a former government scholarship holder, has an interesting blog post in which she points out that such statistics may not show the full picture. Change the base year, and the results could be different. Using 2000, 2001 or 2006 as alternative base years, she calculated that resale flat prices have grown faster than household incomes.
If her calculations are correct, some policy recalibration is required to ensure that housing does not become a bigger financial burden on Singaporeans, as that will lead to Singaporeans having insufficient funds for their retirement.
But coming back to Mr Mah's point about unrealistic expectations: The question is why this is so.
Has the Government oversold its housing policy? For decades now, it has encouraged citizens to own their homes, believing this gives them a stake in the country and increases their sense of belonging. The result is that owning a home is what almost every Singaporean now aspires to. Some have even come to expect it as an entitlement.
Meeting this aspiration was perhaps easier in the past than it is now. People had fewer wants; many were happy to move from kampungs or cramped quarters to new flats. However small and in whatever location, a home with a flush toilet was sufficient to make many happy.
Today, however, we have a new generation of Singaporeans who want more, due to growing affluence and a mentality that they should be able to buy the home they want as long as they get good jobs and work hard.
They want a flat that is big enough, in a location close to town, next to an MRT station, near good schools, and at a price that suits them. Are they unrealistic? Perhaps.
But rather than just putting the blame on home buyers, it could be time for the Government to relook a number of the political messages it has been sending to citizens over the years. To manage their expectations better, some fundamentals need to be relooked.
First, the promise of home ownership. This should now come with caveats. A home for everyone - but not exactly at the place and price that you want.
Second, home ownership should not be pushed as the goal to aim for from the start. There is the option of renting first, if funds are tight.
Third, should home ownership continue to be touted as an asset enhancement tool? Such a message may be at odds with the commitment to provide affordable public housing. The Government will be hard put to ensure prices that are comfortably affordable, if prices are pegged to a property market that is constantly rising while incomes do not rise as fast in tandem.
These are complex questions, but the Government should put serious effort into finding good, sustainable answers.
People's expectations can have very real impact on the ground, regardless of whether that ground is paved with real grass or astroturf.
[It is understandable that if you keep harping on how well you have done in providing the citizens with housing, the citizens will take up the issue with you when they are unable to get affordable housing. That said, the problem may be one of timing. At this point, there is a boom in the market. If you want in on it, you will have to pay a premium. Well, booms and busts cycle about. If you can wait, prices will ease. If you can't, it's going to cost you.]