Today’s Straits Times headlines read “Higher grants, more choices for first time flat buyers”.
I will be blunt. To me, never mind how HDB mixes and matches or adjusts their grant structures, HDB Grants are still dirty words. Let me explain.
HDB is a monopoly with a social mission of building truly Affordable flats to house our citizens. That, they have done well in the early years of our independence but over the decades, HDB has become too greedy and cunning. On one hand, pap ministers, especially former National Development minister Mah Bow Tan kept intoxicating and brainwashing Singaporeans that HDB flats are affordable but I urge readers to think harder and deeper if that is really so. If HDB flats are truly affordable, then there is no need for any housing grant whatsoever. I repeat. If HDB flats are truly affordable, then there is no need for HDB to extend generous housing grants to their buyers whatsoever.
Grants are not free money. I repeat. Grants are not free money and they must be repaid back to HDB with interest years later when the flats are sold. What have happened to many people alearly is that after their flats have been sold and the compounded interest on their grants paid back to HDB, they then realised that they are left in a negative equity position. Their seemingly profits from their appreciating flat prices is gone and the balance in their CPF is also low or locked away. Never underestimate the power of compounding interest and interest on those very generous HDB grants could snowball to very, very large sums years later. Please ponder.
If HDB flats are truly affordable, then there is no need to load the buyers with SHG or AHG etc. It maybe too late to wish that greed has not overcome and blinded policy makers at HDB to just build and sell flats the old, good and honest way instead of pricing their flats exorbitantly and use housing grants to masssge and mask unaffordability superably well. Think.
I thank you all for reading my post again.