Speech by SMS Tan on Adjournment Motion "Ensuring Housing Needs of Singles and Singaporeans are met"

Sep 13, 2022

Mdm Deputy Speaker, firstly, let me thank Mr Louis Chua for raising his perspectives on the housing issue. I would like to assure Singaporeans that ensuring affordable and accessible housing for Singaporeans has always been an important priority for this Government.

Today, almost nine in 10 Singaporeans own a flat – one of the highest home ownership rates in the world.

At the same time, we are keenly aware that housing preferences and aspirations change over time and across different life stages of families and individuals. Therefore, MND and HDB have been actively engaging Singaporeans to understand their needs and aspirations, as also reflected in Mr Louis Chua's theme for the Adjournment Motion – "housing needs for Singaporeans". And we have been listening to Singaporeans, hearing their views and taking in their suggestions.

Most recently, as part of the year-long Long-Term Plan Review (LTPR), we have heard from over 15,000 people from all walks of life.

Seniors shared with us that they would like to age-in-place in the neighbourhood that they are familiar with.

Working adults shared with us that they would like to have workplaces closer to home to minimise commute and to have the flexibility to reconfigure their flats to provide more space as more of them work from home.

Couples with young children told with us they would like to live near their family so that grandchildren can be taken care of by their grandparents.

Young couples wanting to get married and settle down shared with us their anxieties of getting a flat at an affordable price, especially in a bullish property market.

Singles, especially those older singles, shared with us that they would like to get a place of their own near their ageing parents so that they can better care for their elderly parents.

Younger Singaporeans have also shared with us that they value their own personal space and would like to stay by themselves, even if it is rental, on a temporary basis. Many of them still wish to own their homes eventually.

We hear these views, aspirations and needs. We take them seriously and feed them into our Long-Term Plan Review, which was recently launched and exhibited at the URA Centre. We have received many valuable feedback and suggestions, some of which are quite similar to what Mr Louis Chua has raised today. We are studying those suggestions carefully and we are engaging Singaporeans as part of the Forward Singapore exercise.

We would want to meet the needs of all Singaporeans, their aspirations and their wants if we can. But we have limited land and resources and would have to prioritise and allocate within these constraints. So, I thank Mr Louis Chua for recognising these constraints and recognising the very difficult stresses and strains the Government has to deal with.

That is why we need to prioritise public housing for those who have more urgent housing needs, for example, implementing income eligibility criteria for BTO for married couples as well as for singles.

I would like to address a couple of points that Mr Louis Chua has raised.

Before that, I would like to assure Singaporeans that even as we engage all of you as part of the Forward Singapore exercise, we have already taken steps to address the concerns raised by various demographic groups and various segments of Singaporeans. We are closely monitoring the situation, to assess if other measures are needed.

On young couples, which Mr Louis Chua talked about, I am glad that Mr Louis Chua has recognised the many moves and steps that we have taken in terms of giving first-time couples priority, including in this recent August BTO launch as well as stepping up and enhancing the various grants and support that we give to first-time couples.

We are also taking steps to raise the housing supply. We are working hard, working with the construction industry that has been severely impacted because of the COVID-19 pandemic to ramp up BTO supply to 100,000 flats till 2025, if demand and circumstances warrant it.

Mr Louis Chua spoke about the demand for BTO flats. We monitor this situation very carefully. Although the application numbers have risen and increased, four in 10 of the applicants did not choose a flat when invited to do so. We are monitoring the supply situation, application rates and the locations where application rates are elevated.

In terms of affordability, I would like to assure Singaporeans that this is an important consideration for HDB and the Government. We have looked at the statistics. Most first-timers only need to use less than a quarter of their monthly income to pay for their loan instalments. In fact, most of them can service their housing loans using their monthly CPF contributions, with little or no cash outlay.

I would like to address a second group of people that Mr Louis Chua spoke about. He talked about singles and the need to cater to their needs, aspirations and wants.

I am glad that Mr Louis Chua has also recognised that, over the years, the Government has been trying to accommodate and support their needs. More recently, we have also made changes to the BTO allocation quota. In 2013, we opened access for singles to purchase new 2-room flats from HDB under the Single Singapore Citizen (SSC) scheme. We have also raised the allocation quota for these 2-room flats in 2015, from 30% to 50% of the non-senior quota in the non-mature estates.

And because we still see a fairly strong broad-based increase in housing demand across all groups, including singles, which Mr Louis Chua spoke about, we have further increased the quotas to better support all first-timers, including singles. Specifically, we raised the non-senior quota from 50% to 65% with effect from the August 2022 BTO exercise. And eligible first-timer singles can also qualify for various housing grants – up to $40,000 for a new flat purchase and $80,000 for a resale flat purchase.

We have taken steps to adjust, to finetune our policies, trying to meet the needs and aspirations of all Singaporeans within the constraints of the land and resources that we have.

There is also another trend that we have observed where more singles and young couples are renting. There is a vibrant rental market, with a wide variety of both public and private options. Some of these are provided by seniors or families who are renting out their rooms or flats to supplement their income and retirement adequacy.

An increasingly popular housing trend, especially amongst the youths, is in the form of co-living or shared housing arrangements with common facilities. These spaces are attractive as they provide the flexibility of shorter-term rental contracts. Some even provide housekeeping services and fully furnished rooms. We see many commercial providers stepping up with innovative offerings that cater to the diverse range of needs for singles and youths.

I think this shows that the market is functioning and responding agilely to consumer demand and preferences. This is an important part of the entire housing market. It is not just public housing and private housing, but also commercial providers with rental options.

We will continue to review developments holistically and comprehensively and assess if there would be ways to work with the private actors to meet the demand from youths and singles.

And to Mr Louis Chua's point about lowering the age eligibility from 35 today to 28 for the housing market for singles, this is an issue that we have discussed before. We are looking at it and, certainly, many Singaporeans have also suggested this idea of lowering the age limit and eligibility criterion as part of our long-term plan review conversations. We will, certainly, engage these issues as part of our Forward Singapore discussions.

But there are considerations that still remain – there are binding constraints in terms of land resources as well as implications on the housing market with enhanced demand. We have to bear in mind that supply is inelastic while demand can change very quickly. That might lead to high prices and those at the margins – especially those vulnerable singles like the elderly singles, single parents and those in need of housing urgently – might be squeezed out.

So, these are considerations that we have to bear in mind.

In conclusion, let me sum up by just thanking Mr Louis Chua for recognising many of the moves and efforts that we have made as the Government to accommodate the needs, aspirations and wants of Singaporeans. This is certainly something that we will continue to work towards as part of the Forward Singapore exercise. We will engage Singaporeans on their housing needs and aspirations and discuss how we can each play our part to build an inclusive home for our families and loved ones.

Singaporeans' housing needs will become more diverse as our society becomes more diverse. And housing is so much a core part of families, society and the social compact between the Government and our citizens, between each of us in society and across generations.

Minister Desmond Lee will be launching our Forward Singapore engagements later this month and we hope that everyone will participate actively, giving us ideas, suggestions and co-develop these solutions together but, importantly, co-create solutions that bring Singapore together and bring Singapore forward, while balancing the needs of various groups of people for housing aspirations.