Ensuring accessibility to all key to keeping public housing inclusive: Indranee

Under the EIP, limits are set on the proportion of flats in each HDB block and neighbourhood that can be occupied by households from every ethnic group.
Under the EIP, limits are set on the proportion of flats in each HDB block and neighbourhood that can be occupied by households from every ethnic group.ST PHOTO: ONG WEE JIN

SINGAPORE - With the housing market reflecting growing income inequality here, Singapore needs to think more deeply about how to keep public housing inclusive and accessible to all, said Second Minister for National Development Indranee Rajah on Thursday (Aug 5).

She also said that the Ethnic Integration Policy (EIP) remains important for ensuring that neighbourhoods remain diverse, another aspect of inclusivity and diversity in public housing that she touched on.

Addressing property agents at the Huttons Annual Congress at Huttons’ office in Bishan, she said the issue of growing income inequality and its impact on housing will become even more pertinent when public housing in prime locations is launched.

"With economic development, we have seen strong economic and social forces that lead to people concentrating in certain estates based on socio-economic status," she observed.

Last August, Singapore University of Social Sciences Associate Professor Leong Chan-Hoong published a study which found that Chinese, Malays and Indians tend to cluster in certain parts of the island based on purchasing power.

For instance, Chinese home owners tended to congregate in more central neighbourhoods such as Bishan. In contrast, Malays typically chose to live in areas such as Tampines and Woodlands, while Indians picked Admiralty and Boon Lay.

Ms Indranee, who is also Minister in the Prime Minister's Office, said the Government is looking at measures to ensure that public housing estates in prime locations - such as those being built in the Greater Southern Waterfront area - stay inclusive over time.

"This will require a new model for public housing in prime locations to keep these flats affordable not only for the first buyer, but also for subsequent resale buyers as well," she added.

On the topic of inclusivity in public housing, Ms Indranee said the EIP remains relevant today. Under it, limits are set on the proportion of flats in each HDB block and neighbourhood that can be occupied by households from every ethnic group.

She recounted how the various ethnic groups lived in different geographical areas during the British colonial era, allowing for easy short-term administration at the expense of long-term racial integration.

But the government of a newly independent Singapore felt that integration could not be left "to chance or to the invisible hand of the market", she said.

Making reference to the recent spate of high-profile racist incidents, Ms Indranee observed that this is proof that Singapore has not yet become a post-racial or race-neutral society.

Today, nearly one out of every three Housing Board blocks has reached at least one of the EIP limits, she said. This is seen across all ethnic groups, in both mature and younger estates. "What this tells us is that integration is still a work in progress, although we have done well so far."

Even so, the Government is not blind to its costs - such as the difficulties that members of minority races may face when selling their flats. That is why the HDB has exercised flexibility to waive the EIP limit in exceptional circumstances, she said, adding that work is ongoing to see how the adverse impacts of this policy can be resolved.

She also urged Singaporeans looking to buy property to exercise financial prudence, especially given the uncertain economic climate, and urged property agents to provide balanced and sound advice so that clients can make informed decisions and buy within their means.

Although the property market is buoyant, the Government's position has always been that property price increases should be sustainable and not run ahead of economic fundamentals, Ms Indranee said.

"Critically, Singaporeans shouldn't purchase beyond what their own income can support, and should maintain financial prudence in their property purchases," she said, adding that property agents should put their clients' long-term interests first.

"Buying a home is likely to be the single largest purchase for many Singaporeans, and there will be significant financial and social implications if home buyers are unable to fulfil their mortgage loan repayments due to loss of income or a rise in interest rates."