HDB, the public housing provider for Singapore, implemented the Ethnic Integration Plan or EIP in 1989 to avert the propensity of racial congregation within each of the 3 main races in Singapore. It was designed to prevent any of these 3 races forming housing precincts that clearly separate one race from the others. In a multi-racial country like Singapore, such occurrence would be very dangerous and undesirable.
This EIP however does not apply to private apartments whether it is an existing development or a new condo launch.
The EIP was painstakingly detailed to restrict the percentage of each race within a particular block. Since its inception, the ethnic ratio of all flats is updated every month in order to reflect the current status. This regular update is necessary because of on-going transactions that will affect the original racial mix. So in a situation where a buyer is taking over a unit from the same race, the original ratio remains. However if the new buyer is of a different race, than the transaction can only proceed if the change in ratio does not exceed the quota of that block.
Obviously there have been instances where the new racial mix exceeded the quota of a block, nullifying the transaction. What this means is that the existing owner can only sell his flat to the same race, thus delaying the selling process. This is one major complaint of a flat owner who is considering selling his unit.
Another criticism is that children of mix marriages face a very grey situation. For example if a child is registered as “Indian-Chinese”, then the front race component ie “Indian” will be taken as the race quota element. This is despite the fact that this child is technically half Chinese. With increasing mix marriages, such dubious phenomenon can become a contentious issue.
Yet another grouse is that Indian or Malay-restricted flats tend to fetch lower prices than Chinese-restricted units, by as much as 8% for similar flats.
By and large, the EIP was implemented to serve a broader, and more crucial purpose in mind – racial harmony. While there were, and there will always be unhappiness among individuals, the macro objective of maintaining racial tolerance accord clearly takes precedence in a multi-racial country like Singapore.
For those who feel restricted by this ethnicity ruling in HDB flats may wish to consider an Executive Condo (EC) or a private property be it a new launch condo or a resale Singapore condo. Read up on Executive Condo (EC) vs Private Condo to get more insights as to which you can consider buying.