Title

Housing Policies in Singapore: Evaluation of Recent Proposals and Recommendations for Reform

Publication Type

Journal Article

Publication Date

6-2014

Abstract

The Singapore housing market is unusual in its high homeownership rate, the dominance of HDB housing, and the extensive intervention of the government in regulating housing supply and demand in both the HDB and private housing sectors. Recent rapid population increases in a low interest rate and high global liquidity environment has resulted in accelerated house prices increases in Singapore. Earlier this year, the government launched “Our Singapore Conversation” of which discussion on housing policies constitutes one major component. This “conversation” comes in the wake of several consecutive rounds of measures to stabilize housing prices using various instruments. This paper evaluates the main policy changes proposed and makes recommendations for housing market reforms: (i) the government need to clarify goals of housing policies and make available more detailed data on the foreign component of our population for better analysis of housing markets; (ii) the housing supply regime should target an overall effective vacancy rate that encompasses both the Housing and Development Board (HDB) and private sector; (iii) policy makers need to monitor carefully excess demand indicators for housing in addition to housing affordability indicators over the entire spectrum of incomes and household types; (iv) housing REITs should be established to provide an alternative investment option as well as to develop an efficient and affordable rental sector; and (v) in addition to macroprudential measures, owner-occupancy requirements and fiscal measures such as stamp duties and property taxes could be further utilized to reduce the foreign demand for Singapore housing and real estate.

Keywords

Singapore, Housing Policies, Housing Reform, HDB, REITs

Discipline

Asian Studies | Economic Policy | Finance and Financial Management | Real Estate | Urban Studies

Research Areas

Finance; Quantitative Finance; Applied Microeconomics

Publication

Singapore Economic Review

Volume

59

Issue

3

First Page

1

Last Page

14

ISSN

0217-5908

Identifier

10.1142/S0217590814500258

Publisher

World Scientific

Additional URL

http://dx.doi.org/10.1142/S0217590814500258

Comments

Paper presented at the Singapore Economic Review Conference held in Singapore during 6-8 August 2013