Singapore is the only gateway city in the Asia-Pacific region where housing is deemed relatively affordable and attainable, a new report has found.
This is when compared to the most populous cities in the region, said the Urban Land Institute (ULI) in its first home attainability index report. The non-profit education and research institute gathered data on housing and household income for 28 cities in Singapore, China, Japan, Australia and South Korea.
The Republic has the highest homeownership rate of nearly 90 per cent, due to the low cost of Housing Development Board (HDB) units, which have a median price of US$379,283 (S$527,918). Private homes with a median price of US$1.13 million represent less than 20 per cent of the total housing stock.
That being said, Singapore's non-HDB homes are the most expensive to rent in the region with a median monthly rent of US$2,046. This is followed by US$1,895 for Sydney houses.
When measured on a rent-to-income ratio basis, Hong Kong is the most expensive city for rental, with monthly rent representing about 50 per cent of median household income. This is unsurprising given Hong Kong's reputation for being the world's most expensive city, ULI said.
However, the deeply subsidised public rental housing - which comprises a third of the total housing stock - provides inexpensive options for renters.
[[nid:593168]]
Hong Kong is also the most expensive city in the region to purchase a home, with a median home price of US$1.27 million. The data only took into account private-sector homes, which represent half of the total housing stock in Hong Kong.
ULI noted that local private housing prices have surged by 6 times since 2003, with a 150 per cent jump in rent. The typical down payment for a mortgage in Hong Kong also stands at around 40 per cent, the highest in Asia-Pacific.
Hong Kong's homeownership rate stands at 48.6 per cent, on par with Seoul. Japan has the lowest homeownership rate at 37 per cent, while Chinese cities have a homeownership rate ranging between 70 and 80 per cent.
On a median housing price to median household income basis, Shenzhen is the least affordable city for home purchases, mainly due to the limited new supply of commercial housing, coupled with the city's rapid population growth, ULI noted.
ALSO READ: Singapore's first-time homebuyers in a bind as public housing prices close in on record levels
This article was first published in The Business Times. Permission required for reproduction.
