ST : Will Mah lose votes over rising flat prices?

Dec 10,2010

Will Mah lose votes over rising flat prices?

As National Development Minister, the leader of the Tampines GRC PAP team is seen as a lightning rod for voter dissatisfaction with rising public housing prices. How will Mr Mah Bow Tan face the flak? Or does his service of 22 years as MP make him politically invincible? Cai Haoxiang and Li Xueying report

FIFTEEN years ago, air cargo industry worker Syed Mahmood, 48, and his wife bought their four-room HDB flat in Tampines for $110,000. Today, it is worth $400,000.

But the couple are worried that their three children - aged 23, 22 and 17 - will not be able to buy flats of their own when they get married.

'Property prices just keep increasing,' Mr Mahmood laments. 'We will have to step in to support them. We will sell our flat and downgrade to a three-room flat.'

Despite his anxiety over rising property prices, Mr Mahmood remains unwavering in his support for the ruling People's Action Party.

'It is a good Government and, to be fair, they have given us a lot of medical and education subsidies,' he says.

Sentiments like Mr Mahmood's abound in the five-ward Tampines GRC, going by a straw poll of 30 voters.

Their pride in living in an award-winning township is evident. Tampines New Town won the United Nations World Habitat Award in 1992.

Now it boasts even more amenities, including various parks and three malls near the Tampines MRT station: Tampines Mall, Century Square and Tampines 1, which opened in April last year.

Tampines is called a 'maturing town' where many residents bought their flats about 20 years ago and are now in their 50s and 60s with teenage children, like Mr Mahmood.

What is notable about Tampines GRC is that it is not only much coveted by Singaporeans as a self-sufficient residential town, but also by the opposition as a hot battleground. It was contested by the National Solidarity Party (NSP) in four elections - in 1988, 1991, 2001 and 2006.

For the next polls, the NSP is once again raring to go. It intends to capitalise on ground disaffection with rising flat prices to hit out at public housing policies and in particular the GRC's anchor minister, National Development Minister Mah Bow Tan.

The NSP plans to field its 'A' team comprising its 'top five', its secretary-general Goh Meng Seng tells Insight. He will lead the team but declines to reveal the line-up.

His message to Tampines' middle-class voters: Flat prices are becoming unaffordable. The PAP's asset-enhancement concept is a 'myth'.

'People cannot sell the flats anyway as the capital gains are only on paper,' he says, noting that earlier generations only needed 15 years to pay off their loans.

'Now, if you get married at age 30 and pay off your flat at age 60, how much CPF will you have for retirement? If the PAP's policies continue, future generations might take 40 or 50 years to pay off their loans,' he says.

The NSP is zeroing in on the housing issue as it has been a red-hot topic these past two years. Such was the outcry that in a dialogue in January, Minister Mentor Lee Kuan Yew said that if Mr Mah could not defend the HDB's asset-enhancement policy, he 'deserves to lose'.

Angst over price hikes

THE HDB resale market has seen nine straight quarters of record prices on the back of a vigorous economic recovery that began in the second half of last year.

Last month, flats were still being sold in mature estates at jaw-dropping prices. The median resale prices for five-room flats were $565,000 in Bishan and $725,000 for Queenstown.

Some Singaporeans, especially upgraders and young couples, are upset that their desired property is out of reach.

Tampines resident Chia Tuck Seng, 50, who lives in a three-room flat with his wife and two children aged 12 and 15, wants to upgrade to a four-room flat.

'But over the last two or three years, the prices are just too high. Yes, we can get a lot for this flat, but we will have to pay a lot for the new flat too,' he says.

Student Sarah Ismail, 24, and her boyfriend Farhan Halid, 26, a senior sales associate, want their own flat but failed twice to be picked for the HDB's Build-To-Order scheme.

'It's quite disheartening,' she says. 'We want to get married and want our own flat. At the same time, we can't afford resale flats because the COVs are too high.' COV, or cash over valuation, is the cash premium that buyers pay.

Human resources manager Jessling Koh, 42, who is single, says that while she is content living in Tampines, it will be difficult if she moves out of her parents' home and buys her own flat.

'I need to take 20 to 30 years to pay for the flat and work for the rest of my life, and I don't want that,' she says.

But surprisingly, 28 of the 30 voters Insight interviewed say that while they might be uneasy about rising flat prices and burdened by the higher cost of living, they do not blame Mr Mah as they believe that the PAP has mostly done right for the country.

As hairdresser Nancy Chung, 50, puts it: 'High prices are not Mr Mah's fault. The demand for flats is high. There must be a reason for the PAP's policies that resulted in high flat prices.'

Machine repairman Ye Chye Huatt, 49, says philosophically: 'Flat prices are like fish prices. They rise and fall.'

To cool the property market, the Government has been launching new flats and releasing more land for residential use. New measures include restricting home buyers from owning both a private home and an HDB flat within the minimum occupancy period.

The man in the hot seat is making sure his voice is heard in various media. Mr Mah has written commentaries in Today newspaper on affordable housing and housing for the poor, noting that he has received positive feedback.

'I just keep on explaining,' he tells Insight. 'I explain that prices are affordable, you can afford it, and you'll have a nice house to stay in. That house will increase in value over time and that value will be used to fund your retirement.'

Last month, he noted that the price stabilisation measures were working, with median COV payments falling from $30,000 in the third quarter to $25,000 in October. Earlier this week, he said that COVs had fallen to $22,000 last month.

'What is more important to me is to give the sense that prices are stabilising,' he says. 'If people see that prices are running away, they get very anxious, they want to rush in and compete. But if prices are stabilising and in fact start coming down, people start to be calmer.'

Municipal grouses

WHEN it comes to municipal issues, cleanliness continues to be the top concern among constituents.

In October, Tampines North residents were up in arms over rubbish chutes that stank with overflowing rubbish, and void decks strewn with litter for days.

A new contractor had problems getting foreign workers, and the town council was slow in reporting problems. An emergency task force was set up and a new contractor hired. MPs stress that residents have a part to play in keeping the estate clean.

At Block 208, Tampines Street 21, a resident who wishes to be known only as Mr Kuek rants about how rubbish does not get cleared from the grassy area.

Says the 46-year-old repairman: 'It's an embarrassment. If foreigners walk by and look at this, they will ask, why is it that Singapore's Government is so rich but this place is so dirty?'

Lift upgrading used to be an issue but not any more, say residents. This is because lifts have been upgraded to stop at every floor or will be upgraded soon. All eligible blocks in Tampines GRC will have their lifts upgraded by 2013.

Another municipal issue is the lack of parking space for residents. 'Some even have three cars per family,' notes Mr Mah, who is looking at broadening parking zones.

The most common problems brought up at Meet-the-People sessions relate to financial assistance and housing - loan repayments, people wanting rental housing, and young couples asking for faster allocation of flats.

Problems peculiar to Malay residents, say Tampines North MP Ong Kian Min, are big families and overcrowded flats.

To mitigate social problems, MPs run various welfare programmes. For example, Mr Sin Boon Ann runs a wish-fulfilment programme for children in Tampines Central, while Ms Irene Ng has an elderly-befriending and support project in Tampines Changkat.

The influx of foreigners working at nearby Changi Airport and the banks in Tampines Central has created some resentment and friction with the locals.

Ms Stephanie Low, 24, a market researcher, voices a common complaint about overcrowding by foreigners. 'The Government encourages us to take public transport but when you take the train, it is too crowded,' she says.

Housewife Noor Aishah, 42, is concerned about 'jobs that go to foreigners', while bank vice-president Francis Lee, 40, feels that not enough is being done to groom and retain local talent.

'As I grow older, it erodes my chances of employment. The foreigners cause social problems, force property prices up... this affects my vote against the PAP,' he says.

How will they vote?

OUT of the 30 residents interviewed, about half say they are PAP supporters and most of the rest are undecided, with a few die-hard opposition supporters.

Says Madam Chung: 'I will vote for PAP. It has managed the country well, but it should think of those who cannot afford to buy flats.'

The fence-sitters say that if they support the opposition, it will not be because flat prices are high. Rather, it will be because they have found high-quality opposition candidates whom they can relate to.

Expressing such a sentiment, lorry driver Ong Chuan Eng, 56, who has lived in a four-room flat for 10 years, says: 'Now I am 50-50 in deciding whom to support. I will support the opposition party which can change Singapore for the better.

'There must be competition. If one party can do whatever it wants, then we don't need to have Parliament.'

Although Mr Mah, who has been the National Development Minister since 1999, is ready for any political challenge anywhere, he hopes to remain as MP for Tampines East ward.

As MP for five terms, Mr Mah has pioneered innovations such as the 'three-in-one' family centre. This houses a child-care centre, a day centre for the elderly, and a before-and-after-school care centre.

He recalls abortive attempts in the 1990s to launch a neighbourhood TV station and a website for the town. These ideas were 'ahead of their time', he notes.

Tampines has the distinction of being Singapore's first cycling town with broad pedestrian paths. The push came from Ms Ng, who wanted cyclists to ride on pavements instead of busy roads.

Reflecting on his emotional attachment to his ward, which he has looked after for 22 years, Mr Mah says of his constituents: 'I've seen their kids grow up, have children, I've seen them growing old in this place. I've grown old with them actually.

'So I hope that when the Prime Minister decides who to go where, he will decide to keep me here.'

haoxiang@sph.com.sg

xueying@sph.com.sg


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'I get more flak than usual'

In an interview with Insight, National Development Minister Mah Bow Tan talked about the housing issue and the Singapore dream. Here are some excerpts.


People say they have to take 30 years to pay off their mortgage, and when they retire at 62, they have nothing left in their Central Provident Fund account. What is your response?

Would they be better off leaving their money in their CPF and paying rent for 30 years, instead of putting it into their HDB flat? The HDB flat is a store of value, and the value goes up over time. We make it easy for people to convert that value into cash when they retire, through various schemes such as Lease Buyback, or downgrading to a smaller flat. This will partly fund their retirement, in addition to other income from their CPF such as CPF Life, plus other savings and investments.


Does it mean that if you have a five-room flat, you would need to downgrade to a four-room or three-room and use the money to fund your retirement?

I think it is quite a normal and rational thing to do. People who own private property downgrade to a smaller house or an HDB flat. People who buy HDB five-room flats downgrade to a four-room, three-room or even studio apartment. If we did not have the home ownership scheme, people would still have to stay somewhere, and they end up renting. At the end of 30 years, they have zero assets, are they better off?

It's a massive subsidy that we've put into housing that has created this home-owning population. Of course, the opposition will come around during elections and say why not increase the subsidy even further, why not make it cheaper. But who's going to pay for it?

They don't have the responsibility of creating the wealth to pay for it or making the decisions, the trade-offs, such as which part of the Budget to cut - defence, education, health care. We shall see whether that line will sell in the elections.


Isn't it politically risky to tell people to downgrade if they have no retirement savings?

The fact is that most people don't need to downgrade. HDB surveys show this. The house is just one of the assets that people have. They have CPF savings, other savings, some continue to work, others get support from their family. Of course, the political agitation and the pressure is there, to make it more affordable. So we'll have to explain why it's already affordable, why we're already spending so much on housing, about a billion dollars a year, and why we think that that's about the right level, what the country can afford.


Have voter aspirations changed over time?

No. They haven't changed. People want to have a good life, good jobs, good homes, stability and security. The heartlander in the HDB flat wants to provide good meals for his family, good education for his children, so he needs good jobs. He also wants to relax, to walk around, talk to his friends, take part in some community functions, sing karaoke, go for tours. He just wants a simple life. He has a sense of who he can trust to deliver this good life.


Will the Singapore dream of owning a property be out of reach for future generations?

No, it should not be. He should still be able to own a property. But the type of property may have to change. If you are a young person in Hong Kong today, 27, 28 years old, three to five years after university, what can you afford to buy? Hardly anything. What can a Singaporean afford? A nice home in Punggol, Bukit Panjang, in Tampines, and if you're lucky you can even get one in Dawson or Pinnacle. That's the difference.

We have to work with the cards that we have been dealt. Singapore is a small country with limited land, no resources. To earn a living we have got to be cleverer and work harder than other people.

The Singapore dream is owning a property, but it's also about a better life for us and our children, and a society which gives you fulfilment, where you can actually make a difference. We can achieve this Singapore Dream.


Is your job stressful?

I think I do get more flak than usual. I get more than my fair share of people attacking me, especially on the Internet. But I've been in this situation before, when I was dealing with transport. That was another hot seat.

I have been dealing with housing for slightly more than 10 years now, and for eight of those years it was not an issue. I believe that our housing policy is the right policy and what we are doing is good not just for people today but for people down the road, future generations.

There's no easy way out, we have limited land. I think we've done pretty well as a country and as a people.