Singapore: Asia-Pacific's Pinnacle of Real Estate Value

In a significant real estate revelation, Singapore has solidified its position as the apex for both owning and renting private homes in the Asia-Pacific region. Recent data shows Singapore’s median private home price soared to an impressive US$1.2 million in 2022, outshining Hong Kong’s US$1.16 million.

Ownership & Rental Prestige:

Singapore not only holds the crown for the highest median private home price but also claims the title of the region’s priciest city for renting private homes. Amid housing supply constraints caused by pandemic disruptions, the government responded with strategic property cooling measures, including doubling the buyer’s tax for foreigners to 60%.

Hong Kong’s Story:

In stark contrast, Hong Kong witnessed a sharp decline in home prices due to shifting demographics and rising mortgage rates. While Hong Kong leads in price per square meter, Singapore’s strength lies in its robust homeownership culture, with a remarkable 90% homeownership rate across public and private housing.

Market Dynamics:

Singapore’s median HDB price surged by 7.9% to reach US$409,000, with a ratio of median HDB price to median annual income rising to 4.7. For private homes, this ratio soared to 13.7. However, only Singapore’s HDB flats and select units in Melbourne and Brisbane maintained affordability based on the ratio of median home price to median annual household income.

Rental Insights:

Singapore’s median monthly rent for private properties experienced an astonishing 30% leap, hitting US$2,596. Factors like a sudden influx of migrants, construction delays, and limited rental property inventory fueled this surge.  Singapore’s median rent constituted 35% of household income, with higher-earning renters having a lower percentage.

Expert Projections:

Acknowledging these shifts, Singapore’s Ministry of National Development anticipates rental pressures to ease as supply-side challenges ameliorate. The disruptions caused by COVID-19 are gradually subsiding. With eased border estrictions and strong demand from expats and locals, rental pressures are expected to normalize.

Cr.CNA