The suggestion by Dr Thomas Lee Hock Seng to adopt a balloting system for resale flats for fairness and equity is not wise or feasible (Conduct balloting for resale flats to be fair, June 3).
There are some points to be considered.
About 80 per cent of Singapore’s resident population live in Housing Board flats, of whom around 90 per cent own their homes. This ownership gives Singaporeans a valuable asset.
An HDB flat may be the only asset for most Singaporeans, and asset appreciation has become a centrepiece policy of the Government, as rightly pointed out by Mr Foo Sing Kheng in his letter, “Asset appreciation a centrepiece policy of the Government” (June 3).
Fixing a predetermined resale price based on length of lease remaining and the cost of ongoing construction of similar flats in similar locations as suggested by Dr Lee is problematic.
The process is laborious and it would be hard to work out all costs involved, especially those of the construction industry, which can be fluid and hard to estimate.
The resultant predetermined price might be inaccurate and adversely affect the price of the flat.
There are various reasons people buy resale flats. Having a ballot system would introduce an element of luck in determining whether a buyer gets his flat or not.
This may deprive buyers who can afford the seller’s asking price of buying their choice flat.
There would be no incentive for people to sell their flat if the predetermined price is low, and not the price they want. This may upset the forces of supply and demand in the market.
In addition, HDB presently conducts balloting for new flats for eligible Singaporeans.
But the resale market is for eligible Singaporeans and permanent residents, and HDB is not obliged to conduct such balloting for resale flat sellers and buyers.
Ng Choon Lai