Thursday, September 01, 2005
poor poorer poorest
Grabbed the post header from stormyash's most recent journal entry.
Her first paragraph talked about most people wouldn't have any savings or are in debts. The definition of home ownership, and the implicit encouragements of mandatory home ownership, means that by default, almost every single HDB household IS in debt.
Just take the recent policy change about being able to get 90+% home loan. Put it in simple terms, that just makes the families that take up that offer to be in debt for another 10 more years easily. Eventually, we'll reach the situation like in Japan, where THREE generations are needed to pay up for a property. (I got this info from a few japanese friends, might not necessary be true.)
However, assuming that is the case, the critical difference is that in Japan, after suffering for 3 generations, you own the house. Not a lease, and definitely not a 99 year lease.
A 99 year lease will create a situation where by the time it is fully paid up, your family will no longer have the lease. Now why would that be a good outcome?
Coco is category 1. She needs to start to curb the expenses drastically. Anything that is not essential needs to be stopped.
Sharon and I are category 3 now, especially Sharon. However, being in cat3 doesn't necessary means that we are not poor. Just not in debt.
Now... in a society (here) where living on credit is something of a lifestyle choice, and something to be proud of, we are definitely the "corner cases", so to speak.
I think there should be a few more categories to go before we can totally cover every scenario.
For example, those that do not owe $$,, but are living hand to mouth on a daily basis.... analysis paralysis.
Her first paragraph talked about most people wouldn't have any savings or are in debts. The definition of home ownership, and the implicit encouragements of mandatory home ownership, means that by default, almost every single HDB household IS in debt.
Just take the recent policy change about being able to get 90+% home loan. Put it in simple terms, that just makes the families that take up that offer to be in debt for another 10 more years easily. Eventually, we'll reach the situation like in Japan, where THREE generations are needed to pay up for a property. (I got this info from a few japanese friends, might not necessary be true.)
However, assuming that is the case, the critical difference is that in Japan, after suffering for 3 generations, you own the house. Not a lease, and definitely not a 99 year lease.
A 99 year lease will create a situation where by the time it is fully paid up, your family will no longer have the lease. Now why would that be a good outcome?
Coco is category 1. She needs to start to curb the expenses drastically. Anything that is not essential needs to be stopped.
Sharon and I are category 3 now, especially Sharon. However, being in cat3 doesn't necessary means that we are not poor. Just not in debt.
Now... in a society (here) where living on credit is something of a lifestyle choice, and something to be proud of, we are definitely the "corner cases", so to speak.
I think there should be a few more categories to go before we can totally cover every scenario.
For example, those that do not owe $$,, but are living hand to mouth on a daily basis.... analysis paralysis.
