By MP for Punggol East SMC, Lee Li Lian
[Delivered in Committee of Supply on 10 March 2015]
During the debate on the President’s Address last year, I called for the Ministry to consider expanding the number of 3-room PPHS flats. I noted that the take-up rates of 4- and 5-room PPHS flats were much lower due to high rental costs.
I acknowledge the Government’s efforts since then to reduce rental costs by allowing for co-renting, and to increase the number of 3-room PPHS flats to be made available in the first and second quarters of 2015.
Based on the HDB website, I note that more than 60% of the 3-room PPHS flats to be made available will come from only one location in Jurong West. While I understand the constraints of finding eligible vacated SERS flats for adoption into the PPHS, I hope that the Ministry can make more efforts to spread out the number of such flats throughout the island.
Next, I would like to propose to the government to study the feasibility of pegging these rental charge to median income of those applying for the same class of flats rather than to the market rate. The recommended affordability rate is for a debt service ratio of 25%, which means if the median monthly income is $2000, the mortgage payment or rent should be $500. This will lower the rental charges substantially and make PPHS more affordable, attractive and thus further improve the take up rate.