ACQUISITION OF PROPERTY WITH CPF SAVINGS

Maj Fong Sip Chee asked the Acting Minister for Labour (1) how many Central Provident Fund depositors have used their savings to acquire private properties; (2) the total amount so withdrawn; and (3) that in view of the fall in property prices, what ramifications there are for these depositors.

Mr Lee Yock Suan: Up to 31 Jan 85, 20,166 Central Provident Fund depositors have used their savings to acquire private residential properties.

A total of $1,321 million has been withdrawn for this purpose.

Residential properties like other investments are subject to varying levels of risk. Their prices and values are determined by market conditions of demand and supply and by the political environment. CPF depositors should be conscious of this when they decide to invest in the property market which is expected to be a good hedge against inflation in the long term. As long as the economy is properly managed and there is political stability, prices of residential properties in Singapore are likely to increase in the long run because of our limited land area, although short-term price fluctuations are unavoidable.