The unequal distribution of resources may not be rational, but it is inevitable in a capitalist and meritocratic society. Even the us share the same problem: http://www.economist.com/news/leaders/21571417-how-prevent-virtuous-meritocracy-entrenching-itself-top-repairing-rungs
However it is not the end of the game for the less resourced as they have another chance in getting into top secondary schools, if they work hard enough. This is social mobility at work. The government is trying to level the playing field but it is impossible to just redistribute resources and give each successive generation an equal footing.
For top schools like Nanyang, RGPS, alumni kids have a higher probability of being better than other neighbourhood kids since more than likely their parents are well educated and well resourced. This is not from an individual perspective,the schools would have to look at this statistically.
The alumni system is not removed for many reasons; my point was that property prices correlates with giving absolute priority to proximity. Cooling measures are for the market as a whole so it is not in the picture, but if staying near a school guarantees admission, the prices in this area will be skewed as (some) parents are prepared to pay any price for a place in the school.
