PM Lee rebuts notion that 99-year HDB lease is extended rental, not a sale

[SINGAPORE] Prime Minister Lee Hsien Loong set out on Friday (Aug 24) why home ownership is a key national policy, saying it gives every Singaporean a stake in the country and has improved lives significantly for all.

On the issue of 99-year Housing Board (HDB) leases, Mr Lee rebutted the notion that the lease is "merely an extended rental" and not a sale.

He said he found the argument by some commentators "frankly, amazing", as many private properties are also held on 99-year leases but no one argues they are merely being rented.

"HDB lessees have all the rights over their flats that owners of such leasehold private properties have," said Mr Lee, at a book launch held at the National University of Singapore.

In fact, HDB owners enjoy extra privileges, because their flats get upgraded from time to time with generous government funding, he added.

Public housing was one of the hot-button issues Mr Lee addressed at the National Day Rally on Sunday (Aug 19).

Returning to the issue today, Mr Lee said home ownership enables every Singaporean to share in the country's economic growth, because as the economy grows, so will the value of their home.

Nearly every household - even low-income ones - has a substantial asset to their name.

"As a result, we have improved lives significantly for all. We have avoided the extremes of privation and poverty often seen even in affluent societies," he said.

The prime minister noted the Government could have adopted other policies to house the population, suchas providing rental flats at subsidised rates, having controlled rents like in San Francisco, or leaving housing largely to the private market like in Hong Kong.

But none of those alternatives would have achieved the same economic and social results as home ownership, he said.

The experience of other cities show the private market will not provide adequately for poor or even middle-income families, Mr Lee said.

He added that rental housing creates a very different mindset from owning a home, as a tenant lives from month to month and has no interest in the property's long-term value as he cannot sell the property or leave it to his children. "It is not yours."

In comparison, a homeowner takes responsibility for his property, thinks long term and does his best to protect its value, he said.

This is done directly through good maintenance and upkeep, and also indirectly by upholding the society and system on which the value of his home depends, he added.

That is why HDB sells flats to Singaporeans, and even for low-income households, it prefers to sell a very heavily-subsidised flat to them, rather than offer them a subsidised rental unit, he said.

THE STRAITS TIMES