New report says HDB model inspires other governments in the region
'Singapore is the only capital city to offer attainable homes for purchase,' the report says.
Moreover, it also shows how the HDB model of the city-state has inspired other governments, calling the ability of citizens to buy apartments at a fraction of open market rates one of Singapore's 'notable successes.'
'Across all years of the Home Attainability Index, HDB apartments have been the most attainable route to home ownership in a major Asian city, with prices consistently under five times median income. HDB apartments are also significant because of their ubiquity; they house 80% of Singapore's population. Private sector apartments and houses are typically (but not exclusively) owned by wealthy Singaporeans and rented by expats.'
However, the report underlined that private homes are priced at 16.9 times the annual median household income, for an average price of US$1.7 million (S$2.18 million), making them the most expensive in the region.
It noted that other countries have launched programmes that appear to follow the HDB model, including Malaysia and Thailand. The Residenci Wilayah scheme in the city-state's nearest neighbour also gives people the chance to buy homes at prices below market rates. In Thailand, meanwhile, an initiative called 'Homes for Thais' uses land belonging to the state to offer people properties with a 99-year lease.
The report pointed out, however, that in countries where the government does not have the same amount of control over freehold land, conducting this type of programme is much more of a challenge than it is for the HDB.
'Meanwhile, in some jurisdictions, there are objections to the government essentially controlling the majority of the housing market. However, the most significant objection to similar schemes is the risk that they might reduce the value of existing stock, a significant factor in countries where the majority of people own their own home,' the report adds.
The report even asks if Hong Kong should follow in Singapore's footsteps when it comes to homeownership. Hong Kong's Home Ownership Scheme (HOS) lets citizens purchase homes on the basis of shared ownership, where the government has a 30% stake and citizens pay 70% of the property's value.
This went on from the late 1970s to 2002 and was resumed again, albeit in a limited fashion, in 2011, although a number of think tanks in the city believe that public housing tenants should be permitted to buy the housing units they rent at a subsidised rate. /TISG
Read also: S$407 million boost for HDB flats, major upgrades to enhance living conditions for thousands
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