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02-05-2015, 12:48 AM
Let's put it in another way.
If ALL land parcels allocated to building HDB flats are being auctioned to private developers.
And the private developers are to develop exactly the same physical units as the HDBs, only difference is that they are private now.
What would be the pricing like? Due to the much higher supply, prices of private apartment would fall but probably not to the level of new HDB flats. So there is this gap in pricing. So we can term it as subsidy. As $ is clearly demonstrated.
BUT in that scenario, we would not have the restrictions laid down by the HDB, which is a consideration.
Taken as a whole, the subsidy is there(if you want to put it that way) but is more financial engineering than anything else.
Public flats CAN be made cheaper, it's a matter of whether the cheaper flats will upset the stability in prices build up over the years. Also a depreciating asset(HDB) can be detrimental to the overall economy, much like a depreciating Singapore dollar.
If ALL land parcels allocated to building HDB flats are being auctioned to private developers.
And the private developers are to develop exactly the same physical units as the HDBs, only difference is that they are private now.
What would be the pricing like? Due to the much higher supply, prices of private apartment would fall but probably not to the level of new HDB flats. So there is this gap in pricing. So we can term it as subsidy. As $ is clearly demonstrated.
BUT in that scenario, we would not have the restrictions laid down by the HDB, which is a consideration.
Taken as a whole, the subsidy is there(if you want to put it that way) but is more financial engineering than anything else.
Public flats CAN be made cheaper, it's a matter of whether the cheaper flats will upset the stability in prices build up over the years. Also a depreciating asset(HDB) can be detrimental to the overall economy, much like a depreciating Singapore dollar.