Singapore's public housing continues to receive international recognition for being both attainable and affordable. Recent reports by Demographia International Housing Affordability 2024 and the Urban Land Institute (ULI) highlight the success of Singapore’s public housing model, despite rising property prices in 2024.
According to the Demographia International Housing Affordability 2024 report, Singapore moved up to 11th place among 94 major housing markets for housing affordability, a significant improvement from its 47th place ranking in 2023. The report attributes this leap to Singapore’s strong public housing policies, affordability measures, and subsidies, even as housing prices rise.
The Urban Land Institute (ULI) also ranked Singapore's public housing as the most attainable across 48 cities in 11 countries in the Asia-Pacific region in its 2024 Asia-Pacific Home Attainability Index report. Despite rising resale flat prices, HDB flats remain accessible for most Singaporeans, with the Housing and Development Board (HDB) emphasizing that the resale market is still “largely within reach of buyers.”
Rising Resale Flat Prices in Q3 2024
While Singapore’s public housing is rated highly for affordability, the latest data reveals a steady increase in resale flat prices. In Q3 2024, public housing resale prices rose 2.5%, with the average resale price increasing by 2.9% to S$629,856. The higher demand for resale flats is partly driven by the limited supply of new public housing, pushing buyers towards the resale market.
Despite these price increases, public housing in Singapore remains far more affordable than in other cities. For instance, ULI's report shows that the median price of HDB flats is 4.7 times the median household income, whereas in cities like Beijing, Manila, Ho Chi Minh City, and Shenzhen, the ratio ranges from 25 to 32 times. This stark contrast emphasizes the success of Singapore’s public housing policies, which keep housing prices more manageable for middle-income families compared to other major urban centers in Asia.
Improved Housing Affordability Metrics
Demographia’s report indicates that Singapore's headline median multiple—a measure of home price to income ratio—dropped to 3.8 in 2024 from 5.3 in 2023. While this improvement is significant, the median multiple of 3.8 still places Singapore in the “moderately unaffordable” range. Housing is considered affordable if the ratio is three or below, moderately unaffordable if it falls between 3.1 and four, and seriously unaffordable when it exceeds five.
Nonetheless, the improvement reflects Singapore’s robust policies that support homeownership, including housing grants and subsidies for first-time homebuyers. HDB noted that about 90% of Singapore’s residents own their homes, one of the highest homeownership rates in the world.
Rising Demand for Million-Dollar Flats
While most resale flats remain affordable, a small proportion of transactions have crossed the million-dollar threshold. In Q3 2024, 328 resale flats sold for over S$1 million, marking a significant increase from 236 such deals in Q2 and 128 in Q1. However, these million-dollar flats account for only about 2% of total resale transactions over the last 1.5 years. Among four-room and smaller resale flats, only 0.5% of transactions exceeded the million-dollar mark.
Analysts expect these numbers to continue rising, with projections indicating that over 1,000 million-dollar flats may be sold by the end of 2024. This rise reflects the strong demand for premium public housing in sought-after locations, as well as the overall tight supply conditions in the resale market.
Summary of Highlights:
- Singapore’s public housing ranked 11th among 94 housing markets for affordability (Demographia Report 2024).
- HDB flats remain attainable: Singapore was ranked the most attainable for public housing across 48 cities in 11 Asia-Pacific countries (ULI 2024).
- Resale flat prices in Q3 2024 rose by 2.5%, with average prices increasing to S$629,856.
- The median price-to-income ratio for HDB flats is 4.7 times, much lower compared to major cities like Beijing and Manila (25 to 32 times).
- Million-dollar resale flat transactions saw a record number in Q3, with 328 deals over the million-dollar mark.
Interpretation of the News:
Despite the rising prices in the resale market, Singapore's public housing continues to be one of the most attainable and affordable options for residents. The strong policy framework that emphasizes homeownership and housing affordability ensures that Singaporeans continue to enjoy accessible public housing, even as demand remains robust. The strategic use of housing grants, subsidies, and the government’s land use policies have been instrumental in maintaining balance in the housing market.
However, the increasing trend of million-dollar transactions may point towards rising inequality in housing accessibility, particularly in more desirable locations. It is critical for homebuyers to stay informed and navigate the market wisely, especially as prices continue to climb in response to limited supply.
If you’re looking to understand more about how these housing trends may impact your future home purchases, or if you’re considering entering the resale market, feel free to reach out to me. I can provide up-to-date market insights and help you navigate the complex dynamics of Singapore’s public housing market. Let’s work together to find the right property that suits your budget and needs.
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