Singapore homes posted a slight decrease in the average prices for the year 2016. This is according to the Demographia International Housing affordability survey that is usually conducted every year. This latest survey marked 13th housing market annual report.
Home prices in Singapore for the year 2016 were 4.8 times the average yearly income of household prior to deducting tax. This is fairly good compared to 5.1 that were posted back in 2013 despite the fact that household income cannot afford to purchase the homes. For it to make more economic sense, the price of home should be lower by 3 times to that of annual income before tax.
Based on the home price and the annual income ratio, the housing markets in Ireland, Singapore and Japan were considered not affordable. The average home prices in the above-named countries were equal to 5.1 times or greater than the yearly household income.
Demographia considered 4.8 to be a very unaffordable rate. Despite that, though, they highly commended officials in Singapore for putting in place a variety of measures that ensured that the masses were still able to purchase houses.
“Singapore compared to other cities in the world has a geography that is scare making it difficult for the development of Greenfield and at the same time sustain a continuous supply of land,”
"Despite having a scarce land problem, Singapore has largely developed it housing program that is sponsored by the public. Its private residential properties market is vibrant and has the highest home ownership rate that stands at 88% making it one of the highest globally," Demographia added.
50 years ago Singapore’s terrain was largely covered by squatter settlements.
Currently, Hong Kong has been rated as the most pricey housing market followed closely by Sydney in the second place and Vancouver in the third place. The affordable cities included Bay City in Michigan, Racine in the state of Wisconsin and Decatur in Illinois, with their ratio being between 1.8 and 1.9.
The latest survey by Demographia contains data of the third quarter of 2016 in which 406 housing market in nine major countries had been considered. The countries are the United States, Canada, Australia, China, New Zealand, Japan, Ireland, the United Kingdom and Singapore.