Concerned citizens: A construction site for a public housing project in Singapore. There is disquiet among Singaporeans that home ownership will become increasingly out of reach for future generations. — AFP
SINGAPORE: Prime Minister-in-waiting Lawrence Wong used a May Day rally to address concerns over a red-hot property market fuelling economic inequality, saying citizens will always have affordable homes.
“Affordable and accessible public housing, like access to first-rate education and healthcare will always be a key part of our social compact in Singapore,” Deputy Prime Minister Wong said yesterday, calling the government-built flats the world’s best.
Singapore’s property prices, which have risen for 12 straight quarters and bucked a global housing slowdown, are shaping up to become a major political issue in the city-state, where elections are due by 2025.
While the government raised property taxes last week that hit mostly foreign buyers and ramped up construction of public housing, there are concerns among Singaporeans that home ownership will become increasingly out of reach for future generations.
“In Singapore, the prime minister has to be a real estate agent,” Wong said. “So I’m learning and brushing up on my skills, and I will use this occasion to practice. When you think about affordability, please don’t just look at the headline price of a build-to-order flat.”
Wong said the median household income has risen 10 times since 1980, and built-to-order public housing has moved in tandem.
Furthermore, a typical Singaporean household continues to use less than 25% of their income to service the loan, just like more than 40 years ago, he added.
Almost 90% of Singapore’s residents own well-designed, government-built apartments they live in. Since its independence in 1965, citizens have been able to buy these units at a steep discount, turning home ownership into a key way for Singaporeans to grow their wealth.
But the past few years, especially the pandemic, which plunged the country into its worst-ever recession while attracting surging money inflows from ultra-wealthy foreigners, have raised fears of growing inequality among citizens.
The government is ramping up the construction of flats after Covid disruptions, with Wong noting that 20,000 flats will be completed in 2023.
The issue is set to feature prominently during presidential elections this year in a vote that will test the nation’s mood ahead of a general election that must be called by November 2025.
The ruling People’s Action Party (PAP) is seeking to win over younger voters facing rising living costs after suffering its worst-ever showing in the 2020 national vote, where it still won 89% of seats.
The South-East Asian nation’s economic concerns come at a sensitive time for the ruling PAP as it navigates a sensitive political succession that will see Wong eventually take over from Lee Hsien Loong as the next prime minister, marking the end of Lee’s roughly two decades in power.
Wong gave the keynote May Day rally address, usually reserved for the prime minister, and this suggests that the leadership succession is in an advanced stage, analysts said.
While little has been said about the timing of the handover of power, Lee has said it will coincide with the timing of the national elections. — Bloomberg
