A step towards narrowing the social divide

The Government's latest curbs on the property market will help prevent a price bubble or a financial crisis for property buyers from forming, given a rising interest rate environment and uncertain global economic developments (Higher stamp duties, tighter loan limits for home purchases; July 6).

More importantly, the decision has prevented a further widening of the social divide, which has been a worry to both the Government and the people.

Monthly salary income distribution is not so much a contributing factor to the social divide in Singapore as asset distribution. I have come across many people who own a few properties, either by acquiring them or through an inheritance, and need not work or have decided to retire early. For these people, collecting rental has been enough to place them among the top 10 per cent of income earners.

With the collective sale craze over the past year, some have reaped windfalls and become more well-off than top salary earners.

The Government and social scientists can try and come up with ways to close the gap or decrease the Gini coefficient, but the most effective way is to decrease the disparity in our asset distribution.

Therefore, the latest cooling measures are welcome not only for people aspiring to own their first property but also for those who are concerned about Singapore's growing social divide.

Matthew Yeo

A version of this article appeared in the print edition of The Straits Times on July 09, 2018, with the headline 'A step towards narrowing the social divide'. Print Edition | Subscribe