Singapore Public Housing: ‘A Nation of Homeowners’

SINGAPORE ~ Public housing is often associated with poverty-stricken slums and other social ills but Singapore’s high-rise apartment blocks built by the government are an exception.
Known locally as “the heartlands,” these towers dominate the urban city-state’s landscape and are home to more than eight out of 10 Singaporeans.
“Essentially we have housed an entire nation and created a nation of homeowners,” Tay Kim Poh, chief executive officer of the city-state’s Housing and Development Board (HDB), told the AFP newswire in a recent interview.
“I have not seen an organization or country that has achieved this level of home ownership. So we are unique.”
Surrounded by lush greenery, these flats are built within self-contained precincts with easy access to amenities including man-made lakes for water sports like canoeing, and parks for jogging and cycling.
Some include track-and-field stadiums and swimming pools.
Smaller, older HDB complexes that lack these extensive amenities still have shops or a fresh market for meat and vegetables. Schools, libraries and medical facilities complete the heartlands living experience.
Ninety-five percent of Singaporeans living in HDB flats own them. The rest are rented out to low-income earners.
The HDB was set up in 1960, during an acute housing crisis that faced the former British colony when many residents lived in squatter settlements or overcrowded units with poor sanitation.
Since its inception, the HDB has built about 900,000 flats, statistics from the government agency showed.
Newly built HDB flats are priced below market levels, making them markedly more affordable than private condominiums, particularly in a market where prices have soared over the past three years.
A two-bedroom condominium unit can easily cost S$1 million (US$699,000) in sought-after districts.
In contrast, two- and three-bedroom flats offered by HDB last year were priced from $100,000 to $402,000, depending on their size and location. Some are near the business district and offer a sea view.

The HDB’s Home Ownership Programme, created in 1964, offers various schemes to help Singaporeans buy flats, the housing agency says. In June the scheme received a United Nations award for improving transparency, accountability and responsiveness in the public service sector.
A newly married couple planning to buy a resale HDB flat in the open market can get a grant of up to $40,000, for example, said Tay.
The HDB also offers housing loans at interest rates below levels charged by banks, he said. Mortgage repayments of HDB flat buyers generally make up less than 25 percent of their monthly household income, according to the housing agency.
These incentives have not come cheaply for Singapore, now one of Asia’s wealthiest countries with gross domestic product per capita of $52,994 in 2007.
With its emphasis on keeping flat prices affordable, the HDB loses money and requires government subsidies.
“We are a loss-making organization for a social purpose,” Tay said with a smile.
In the financial year to March, HDB received nearly $1.25 billion in government grants to cover its deficit, according to its financial statements.
“If we provide homes to our people instead of renting them a home, they have a stake in the country,” Tay said, echoing comments made by Singapore’s founding father Lee Kuan Yew.
In his memoirs, Lee wrote that he “was convinced that if every family owned its home, the country would be more stable.”
Mindful of bloody racial riots that scarred Singapore in the 1960s, the HDB has sought to bolster ethnic harmony within public housing estates.
Every estate has a quota for the various racial groups. Once that quota has been reached, a prospective flat buyer has to seek accommodation in another neighborhood.
Singapore is a multiracial country where ethnic Chinese make up about 75 percent of its resident population of 3.64 million. Ethnic Malays account for almost 14 percent and ethnic Indians about nine percent.
The integration policy has helped Singapore avoid the ghettoes commonly found in other countries, Tay said.
“I say that this is a very successful policy because if you look around the world, there is always a tendency for the different ethnic groups to congregate among themselves.”
Asked if the racial quotas are, in a way, restricting the freedom of Singaporeans to live where they want, Tay said: “We do not force people out.”
Instead, he said, HDB had enabled people of different races and religions to live side by side.
“That, I think, has helped us over the years to bring people together.”

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