CNA : Measures to cool property market needed to avoid drastic measures later: PM Lee

Measures to cool property market needed to avoid drastic measures later: PM Lee
By Hoe Yeen Nie, Channel NewsAsia | Posted: 21 February 2010 2224 hrs

SINGAPORE : There may be no property bubble yet, but Prime Minister Lee Hsien Loong on Sunday said recent moves to curb speculation were necessary to avoid more drastic action later on.

Packed showrooms and fast-rising prices have become a concern for authorities, who introduced new measures on Friday to cool the property market before things got out of hand.

A Seller's Stamp Duty is imposed on all residential properties sold within one year of purchase, while loans from financial institutions are capped at 80 per cent.

At a Lunar New Year dinner at Teck Ghee in his constituency of Ang Mo Kio, Mr Lee said that while the government cannot control property prices, it can ensure prices remain affordable.

Mr Lee said: "Please take good care of it. Do not think of selling it prematurely, or making a quick buck. Because if you sell it and you can't find another house to stay or you do not have a nest egg for your old age, that is big trouble."

Mr Lee said that one's home is a long-term investment, whether as a buffer against old age, or to be passed on to one's children or grandchildren.

But this brought him to another concern - that Singaporeans are not reproducing enough.

Mr Lee noted that Singapore's low birth rate is a reflection of fundamental changes taking place across Asia.

The Total Fertility Rate fell to 1.23 last year - with the rate among Chinese Singaporeans even lower at 1.09.

In China for instance, some young adults even advertise for make-believe girlfriends and boyfriends to hold off family pressure over the Lunar New Year.

Mr Lee said: "It is amusing but it is also sad. I am relieved that I have not heard of any reports of boyfriends or girlfriends for rent in Singapore. I hope it does not happen. But I know that young people do feel some pressure."

Mr Lee added that some social pressure may be useful, but it is family support that will give young Singaporeans a nudge in the right direction. - CNA/ms