18/03/2021
The Greater Southern Waterfront.
I spoke in Parliament about our plans to build public housing in prime locations like the city centre and the Greater Southern Waterfront.
Left solely to the private market, these prime areas would likely be used for exclusive, high-end housing developments that only the well-to-do can afford, given their attractive locations. We see this in many other cities around the world, where housing is much more expensive in certain choice neighbourhoods compared to others, and the average family either has to pay high rents to live in these prime locations, or move further out of the city to buy an affordable home.
These powerful social and economic forces drive the stratification and gentrification of such cities, and can divide communities. But we are determined to resist them, so that our society does not become fragmented over time. We need to take decisive action to ensure that these prime areas continue to reflect the openness and diversity of our society, and enable Singaporeans from all walks to life to live together inclusively.
That is why, even in these prime locations, we will strive to include public rental housing. We will also introduce a new housing model, to ensure that new HDB flats in these areas remain affordable for young families and Singaporeans of different backgrounds.
This will not be easy, as there are many factors to consider. We have been engaging experts, commentators, researchers, professionals, sociologists and members of the public to gather their views, but there are no easy answers.
For example, to keep new flats in these prime areas affordable, our new housing model will have to provide additional subsidies, on top of the generous subsidies that we already provide for BTO flats today. But these additional subsidies could lead to even larger capital gains for owners when they sell their flats on the open market. Hence, for fairness, we may need a way to recover some of the extra subsidies provided for flats in prime locations.
But beyond keeping it affordable at BTO launch, we must also ensure that these estates remain affordable and inclusive over time. We will need to act against the instinct of the market to achieve this. Singaporeans have suggested various ways to ensure this: imposing a longer minimum occupation period; placing restrictions on renting out these flats; ringfencing or limiting the pool of subsequent resale buyers; imposing a subsidy clawback system; or putting in place a buyback scheme. While these are good ideas, the authors of these ideas themselves recognise that there is no guarantee that their suggestions will definitely work, and may even create their own complexities - for instance, some of the restrictions may make things more difficult for those who run into unforeseen financial challenges. Given the challenges, someone even suggested not building any public housing in these prime areas!
But we are determined to press on, despite the complexities, because of our firm conviction that even these prime areas must remain inclusive and accessible to Singaporeans. This is a unique approach, one that very few other cities would be willing or able to attempt to do. But we believe that it is the right thing to do. It is a balancing act, requiring many trade-offs, and we are carefully studying the possibilities. We will continue to engage Singaporeans to find the right balance, before announcing more details
Photo: URA
