Singapore's condo craze highlights rich-poor divide
SINGAPORE, (Reuters) - For years, Singaporeans measured success by "the five Cs" -- cash, car, condominium, credit card and club membership.
But such trophies, especially condos, remain firmly out of reach for many Singaporeans.
While Singapore is the wealthiest country in Asia after Japan in terms of gross national income per capita, it is grappling with a widening income gap that puts it alongside countries such as Burundi and Kenya in terms of income inequality.
The 2007 budget issued on Thursday is expected to tackle such disparities through government handouts to poorer workers after a report released this week showed that 19.3 percent of Singaporean households earn less than S$24,000 ($15,600) a year.
"The five Cs used to be an aspirational goal," said Colin Goh, whose award-winning feature film "Singapore Dreaming" showed how such aspirations can shatter family relations.
"Now, Singaporeans regard them as essentials, and if you're of a certain class, practically an entitlement. Having the five Cs is no longer a sign of attaining entry into the elite. Rather, the absence of the five Cs indicates one's inadequacy," he said.
True, some of the Cs have become more attainable.
Banks, increasingly eager to earn fat fees from consumers, are falling over themselves to offer cash advances and credit cards, although in the case of DBS, the country's biggest bank, customers need to have an annual income exceeding S$30,000.
Prices for club memberships and cars have also declined. But the entrance fee for the 160-year-old Tanglin Club, a relic of the colonial era, still costs S$20,000. Moreover, exclusivity matters. A few years ago, some people who had signed up to join Raffles Town Club sued when they discovered that the club had let in many more people than they had been led to believe, making it far less exclusive.
Even the two magazines which cater to the city-state's affluent – Prestige and Singapore Tatler -- got into a legal spat over which was the market leader when it came to reaching the rich and famous.
Perhaps the most desirable of the five Cs is the condo.
Demand for these is so hot that long queues form outside the sales offices at new apartment launches.
Potential buyers are willing to pay as much as S$4,000 just to have someone line up on their behalf; others sleep on the pavement overnight to ensure a place near the front of the queue. Entire blocks of luxury flats sell out in a matter of hours at the top locations, including a refurbished complex consisting of twin towers -- one in gold, the other in silver. Last year, prices for uncompleted apartments in prime districts surged 25 percent amid frenzied buying from wealthy Singaporeans and foreigners.
"Home to 46 of the most luminous families" is how developer Sime Darby describes its luxury condos -- which cost up to S$5 million (US$3.25 million) each -- on a streetside billboard.
For that, residents can use an infinity pool, sky gym, and spa-in-the-sky, and are close to "prestigious residential neighbours, elite schools, notable five-star hotel, (and) exclusive private clubs," according to its website.
Yet the majority of Singaporeans live in government-built Housing Development Board, or HDB, apartments where there is less scope for making such big investments gains.
These homes are built to a high standard and, in terms of amenities, are vastly superior to some of the public housing available in the United States and Britain.
"Public sector housing prices haven't moved very much, it's stagnant, which means that it's difficult to realise capital when you are retiring," said Chua Beng Huat, an academic and authority on Singapore's housing policy.
Just how difficult that is can be seen on Singapore streets, where it is increasingly common to see elderly people trying to make some money by selling small packets of tissues or cleaning tables in cheap eateries.
The Straits Times newspaper reported last month that some Singaporeans were so poor they could not even afford public housing and were therefore homeless.
"It's definitely a problem that the bottom half of the population where the income growth has been very very weak, these people are extremely vulnerable to economic restructuring and these are the people who really do need help," said Manu Bhaskaran, an economist at Centennial Group.