ST : Cost, Location

Jan 31, 2010

When PRs buy HDB resale flats, key considerations are

Cost, Location

Closeness to others of same nationality not a major pull factor

By Leonard Lim

When Mr Peter Breitkreutz decided to buy a Housing Board resale flat in July last year, living close to other Australians was hardly uppermost in his mind.

A permanent resident since 2008, all the Brisbane native wanted was a five-room unit on a mid to high floor, lift access on each floor and a flat that was not too old.

'We were very open to many areas, except the west because we weren't too familiar with places like Jurong,' said the 43-year-old who works in the financial industry.

He and his wife, who is from China, viewed properties in Woodlands, Ang Mo Kio and Pasir Ris before settling for one in Sengkang.

The flat was close to a pre-school in Yio Chu Kang that they could enrol their two-year-old son in.

It was also a five-minute drive to his office in Ang Mo Kio, until he took up a new job in the city recently.

The flat's valuation was $400,000 but, after negotiations with the seller, the couple knocked back the price to $375,000.

The factors influencing their purchasing decision are not unique, said property agents.

They, as well as other PRs from countries like India, China and Indonesia, confirm that similar considerations are at play behind their resale-flat transactions.

The issue of PRs and resale flats was in the spotlight last week. Minister Mentor Lee Kuan Yew said at a dialogue that the Government did not want to see new citizens congregate and would disperse them across HDB estates.

The HDB also disclosed that it was considering introducing a separate ethnic quota for PRs to prevent enclaves from forming in housing estates.

The latest statistics show there are 533,200 PRs. They own around 5 per cent of the nearly 900,000 HDB flats islandwide.

According to property agents, PRs pick a resale flat primarily based on what they can afford.

They also hope for the flat to be close to their workplace, transport options like an MRT station or bus interchange, and facilities such as schools and supermarkets.

Being near others of the same nationality is not a major pull factor, said agents, though certain locations may see a higher concentration of PRs from a specific country, compared with other districts.

PRs from Myanmar, for example, like Jurong West because they work in shipyards, offices and factories in the area.

PropNex agent Abdul Hamid has seen many Indian PRs going for flats near Lorong Ah Soo 'as there's an international school for Indians there'.

Proximity to places of worship sometimes matters, with some Indian PRs plumping for units in Race Course Road or Farrer Park, to access temples in Little India.

Filipinos choose areas such as Jurong West, Simei and Bukit Panjang for the relatively cheaper prices.

But PRs from Malaysia and China are scattered islandwide.

ERA agent Joyce Lim said her PR clients 'don't really say they want to stay near friends'. It is mainly pricing that influences where they buy, she added.

Deals involving PRs - usually young couples or those with kids - make up 20 to 30 per cent of property agents' monthly transactions.

They note that PRs with higher incomes pick newer estates like Punggol or Sengkang and those closer to town like Queenstown.

In such areas, they may pay up to $350,000 for a three-room flat and $500,000 for a four-room one.

The less well-off opt for more mature neighbourhoods such as Bukit Batok where a three-room flat may cost $300,000, and a four-room type up to $430,000.

But while certain areas may be preferred, agents said they do not know any specific block that has a high concentration of PRs in general, or those from a specific country.

The fact is that PRs and Singaporeans are subject to the same quotas under the Ethnic Integration Policy, introduced in 1989.

Proportions for the main ethnic groups - Chinese, Malays, and Indians/Others - in each block, and each precinct of around 10 to 12 blocks, are subject to quotas.

Sale of a flat to a buyer from an ethnic group that has reached the block or precinct limit is not allowed.

The aim is to maintain a healthy racial mix in estates.

Dennis Wee Group agent Ivy Eyu said a Chinese customer of hers was unable to buy a five-room flat in Queenstown because the quota had been reached.

PRs from Japan, Myanmar, Europe and Africa fall under the Indians/Others category.

And given the influx of immigrants in recent years, agents like ERA's Ms Angeline Lim said they have run into a roadblock when representing Indians.

They have been unable to close deals if the quota for a block or precinct has been reached.

Which is why ERA's senior division director Syed Abdullah Alhamid said: 'Looking into the policy now is a plus point, but I think it's also time to up the quota for the Indians/Others group.'

His firm's marketing director Tan Yam Seng agreed, saying: 'If the Government wants to do anything about it, they should adjust it to reflect the current ratio of the market population.'

limze@sph.com.sg

Additional reporting by Debby Kwong & Sumita Sreedharan


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Living near other Myanmar folk

Mr Win Phyo, 35

PR for three years before taking up citizenship in 2008

From: Myanmar

Home: Five-room flat in Jurong West

Mr Win Phyo and his father paid $379,000 for the third-floor resale unit last year.

The price was $14,000 above valuation and they move in today .

He picked Jurong West as he wanted to live in an area favoured by other Myanmar immigrants too.

'It's important to stay near my friends so when I need help, I can go to them,' said Mr Win, who is single.

He is an assistant manager in a telecommunications firm in Jurong.

He came here to do a master's in Consumer Electronics at Nanyang Technological University (NTU) in 2002.

When he got his permanent residency in 2005, he rented HDB flats in Jurong East and Bukit Batok.

These areas were popular with Myanmar folk too because they were close to where most of them worked.

Mr Win was then working as a software engineer in Changi. But he did not mind the long commute as he was familiar with western Singapore from his NTU days.

Immigrants who rent flats were flagged by Members of Parliament earlier last week, after the issue of ethnic enclaves was raised by Minister Mentor Lee Kuan Yew.

They pointed out that renting in the same areas - and not necessarily buying the flats - has contributed to PRs congregating.

Mr Win bought his Jurong West flat two years after he became a citizen in 2008.

There are about 10 other Myanmar immigrants - either PRs or those who are now citizens - living in flats a few minutes' walk from his place.

None of them lives in his block. The group usually meet for lunch on weekends. 'They will cook for me too when I'm busy - traditional Myanmar food like sour soups,' said Mr Win.

He is making efforts to mingle with Chinese Singaporean neighbours and has shared food with them.

Leonard Lim


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Tampines for work and school

Mr Jony Ho, 30

PR since 2008

From: Indonesia

Home: Four-room flat in Tampines Central

Mr Jony Ho and his wife paid $378,000 for the sixth-floor corner unit last year. They had spent three months house-hunting and viewed more than 12 units in the East.

They paid $23,000 more than the valuation price.

The Hos, who have a son aged three, chose Tampines for reasons linked to work and school. They run a mobile-phone business with two stores in Tampines and one in Pearl's Centre.

'We also wanted to be near schools - distance is an important factor to decide where to enrol our son,' said Ms Joyce Ng, 29.

Their son, Dennis, attends a nursery just opposite their block. There are several primary and secondary schools in the area.

'We think that the Singapore education system is very good, and he will get to mix with children from other races and nationalities,' she added.

Mr Ho, 30, has a brother who lives in Ang Mo Kio. 'We didn't think about finding a place near to his. We both have our own businesses to run and it isn't hard to get around Singapore to meet up,' he said.

Though the Hos note that there is a community of Indonesians here, they spend most of their time with Singaporean friends.

The Hos are from Bintan, Indonesia. They came here in 2006 after obtaining employment passes and became permanent residents in 2008. They previously rented a two-room unit in Chinatown.

The Hos intend to apply for citizenship.

Debby Kwong