SINGAPORE: Singapore’s success in terms of public housing is currently in the spotlight as other countries are asking what they can learn from The Little Red Dot.
The city state’s 90 per cent homeownership rate was the subject of two recent pieces in Australian and United States media.
Homeownership in Singapore is one of the cornerstones of the country’s public housing policy. Subsidies and grants are given to the country’s citizens who intend to buy a home under the Housing Development Board.
On Aug 18, Australia’s ABC News asked, “How did Singapore achieve a homeownership rate of 90 per cent? Can Australia learn anything from it?” For comparison’s sake, Australia has reached the highest level of homeownership at around 70 per cent.
It cited Singapore Management University Economics professor Sock-Yong Phang in Melbourne recently to give the keynote speech at Prosper Australia’s 133rd Annual Henry George Commemorative Dinner.
Prof Phang admitted in her speech that Singapore’s housing scheme, with its extensive government intervention and regulation, would appear “drastic” to other countries.
However, she added, “It is these policies that have resulted in affordable homeownership for 90 per cent of resident households.
Singapore’s experience is a demonstration of how strategic land value capture, government supply of housing, integrating housing with retirement savings, and careful regulation of the property market can lead to a system that provides affordable housing, enabling growth with equity.”
On Monday (Aug 19), Fortune.com also shone the light on Singapore’s housing strategy, pointing out that the housing plan of US Vice President Kamala Harris, who is widely expected to be declared the Democratic nominee for this year’s presidential election, is similar to that of Singapore.
Excitement over Vice President Harris has been growing since last month after President Joseph Biden bowed out of the race and endorsed her in his stead.
The Vice President has been revealing her economic proposals, including housing. American economics writer Noah Smith compared her policy to Singapore’s, and he was all for it.
“In Singapore, the government controls the supply of housing, because it owns about 90% of the land and can decide how much to build.
Singapore’s Housing Development Board increases supply slowly and steadily over time so that everyone has a place to live and so that housing—at least, theoretically—earns a modest but predictable financial return.”
He added, “Critics have lambasted Harris’s first-time homebuyer grants as just another demand subsidy that will push up prices. But Singapore does the same thing! And research suggests that the effect on prices won’t be that huge.” /TISG
Read also: Is Canada seeking to replicate Singapore housing model?
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