Singapore's housing policies

Singapore’s Housing Policies …
Housing a nation : Holistic policies for affordable homes
Presented by : Aliaa M. Shamallakh

5/6/2015
Aliaa M. Shamallakh | IUG | Faculty of
Engineering | Architecture Department
2
Outlines …
1
• Singapore's profile …
2
• Housing policies and history in Singapore …
3
• Goals and principles of housing policies …
4
• Housing policies outcomes …
5
• Problems and challenges …

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Singapore’s Profile …
Name: Republic of Singapore.
Capital City : Singapore.
Type: Parliamentary Republic.
Founding : 1819.
Self-government : 1959.
Independence from UK: 1963.
Merge with Malaysia: 1963.
Expulsion from Malaysia 1965

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Location: Southeast Asia, it is a city-state and island country between Malaysia
and Indonesia.
Area: 718.3 km2 (projected to grow by another 100 km2 by 2030).
Climate: equatorial, a tropical rainforest climate; hot and humid.
Natural resources: Fish, deepwater ports.
Industries: Electronics, chemicals, financial services, oil drilling equipment,
petroleum refining, rubber processing and rubber products, ship repair, offshore
platform construction, life sciences, entrepot trade.
Currency: Singapore Dollar (S$, SGD)

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1960s Today
The “miracle” transformation: from 3rd world to 1st in one life time !

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Population
5.4 million
61.12 % Citizen
23%
Foreign born
38.88 %
permanent residents
The average household
size is 3.47 persons
Population density is
7,615/km2

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Ethnic Groups Chinese 77 % Malay 14 % Indian 8 %
Religions Buddhist Muslim Christian Hindu Sikh Taoist Confucianist

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 Singapore has a highly developed market economy, based historically on
extended entrepôt trade. The Singaporean economy is known as one of the
freest, most innovative, most competitive, and most business-friendly.
 Singapore is the 14th largest exporter and the 15th largest importer in the
world.
 There are more than 7,000 multinational corporations from the United States,
Japan, and Europe in Singapore.
 Roughly 44 % of the Singaporean workforce is made up of non-Singaporeans.

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 Singapore ranked 5th on the Tax Justice.
 Unemployment rate has not exceeded 4% in the past decade.
 Singapore has the world's highest percentage of millionaires, with one out of
every six households having at least one million US dollars in disposable wealth.
This excludes property, businesses, and luxury goods, which if included would
increase the number of millionaires.
 Acute poverty is rare in Singapore. The government has rejected the idea of a
generous welfare system, stating that each generation must earn and save
enough for its entire life cycle.

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Housing Policies …
Slums and living in
(Kampongs) 1920s

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Shortage of Housing:
- Rapidly increasing population.
- Singapore Improvement Trust
(SIT) in 1927 provided affordable
public housing. It built only 23,000
housing units in its 32 years of
existence .

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14-storey block - Queenstown – Downson estate in 1956/ by SIT.

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Key institutions in Singapore’s housing system
Housing and
Development Board
(HDB) - 1960
 HDB town planning.
 Build as many low-cost
housing units .
 sells subsidized public
housing (99 year leasehold).
 Offer mortgages loans
Central Provident Fund
(CPF) - 1968
 Collects employees’ and
employer contributions.
 20% Employees, 13 %
employers.
 Members can withdraw
funds for approves purposes,
including housing finance.
Commercial Banks,
Finance Housing
 Provides market interest
rate mortgages to buyers.
 Make loans to private sector
developers for construction
and investments.

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Selegie House & Bukit Ho Swee estate by HDB (1962 – 1964)

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CPF Mobilization of Savings for Housing

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Housing Stock
(2009)
Owner occupied
unit
Rental Units
Public-sector
884,000 units
78%
95% 5%
Dominance of HDB in housing
 HDB began offering housing units for sale at below market prices, on 99-year
leasehold basis, under its Home Ownership Scheme (HOS). The HDB was able to
price its units below market prices mainly because HDB flats are built on state
owned land.

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Government Land Acquisition (GLA) -1966
 More than 90% of the land in Singapore belongs to the state.
 Land Acquisition Act (LAA) which permitted the state and its agencies to
acquire land for any public purpose or for any work which is of public benefit.
 Government Land Sales (GLS): the government amalgamates land, inserts
infrastructure, provides planning and urban design guidelines, and releases the
land for sale to private (including foreign) developers.

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Resale Market Deregulation (1979 - early 1990s)
 In 1971, a resale market was created when the HDB allowed owners who had
resided in their flats for a minimum of three years to sell their flats at market prices
to buyers of their choice who satisfied the HDB eligibility requirements for
homeownership.
 The minimum occupancy period before resale was increased to five years in
1973 and has remained in place since.
 The debarment period was abolished in 1979 thereby greatly facilitating
exchanges within the public housing sector.

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Resale Market Deregulation (1979 - early 1990s)
 Only citizens, non-owners of any other residential property, households with a
minimum size of two persons with household incomes below the income ceiling
set by the HDB were eligible to purchase new or resale HDB flats prior to 1989.
 In 1989, residential mobility was enhanced when the income ceiling restriction
was removed for HDB resale flats; the resale market was opened to permanent
residents as well as private property owners who had to owner-occupy their HDB
flat.
 From 1991, single citizens above the age of 35 have been allowed to purchase
HDB resale flats for owner-occupancy.

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Housing
Price
Inflation
Financial
Liberalization
Resale
Transaction
 The transaction volume of
resale HDB flats increased from
fewer than 800 units in 1979, to
13000 units in 1987, 60000 units in
1999, and 31000 in 2004.
 Loan financing prior to 1993
was based on 80% of 1984 HDB
new flat (posted) prices. In 1993
granting loan financing of up to
80% of current valuation or the
declared resale price of the flat

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transaction volume of resale HDB flats increased from
CBF Housing Grants
Executive
Condominiums
Anti-speculation
measures
 Shift from total reliance on
subsidies tied partial reliance
on subsidies tied to resale
flats.
 $30000 to purchase a HDB
resale flat close to either
parents' or married child's
residence. And $40000 for
eligible households does not
need to satisfy this criterion.
 a hybrid public-private
house type in 1995.
 The government auctioned
the land off for the
development of EC units to
housing developers who are
responsible for design,
construction, pricing,
arrangements for financing
and estate management.
 housing prices continued
to soar.
 anti-speculation measures
included capital gains taxes
on the sale of any property
within three years of
purchase, stamp duty on
every sale and sub-sale of
property, limitation of
housing loans to 80 % of
property value, and limiting
foreigners to non S$
denominated housing loans.

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Goals & Principles …
1.Developing Vibrant Towns
Comprehensive Town Planning Rejuvenation/Upgrading
-Planning for Self-Sufficiency.
- Neighbourhood Concept .
- Concept of Hierarchy.
- Planning for Connectivity.
- Checkerboard Concept .
- Continually ensure that old
towns and developments do
not lag behind newer towns.
- Facilities are added, existing
ones being upgraded.
- Some areas would be re-
planned and redeveloped to
optimize land use.

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2. Providing Affordable Homes
Promoting Home Ownership in
Singapore
Wide Range of Housing Choices
- Assisting Lower-Income Families.
-Promoting Family Ties .
- Giving Incentives to Singles
Living with Parents.
- Providing more Options for the
Elderly .
- Helping Singles.
- For All Pockets.
- For Different Life Stages.
- New Typologies

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New Typologies / Central Horizon in Toa Payoh

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New Typologies / Pinnacle@Duxton

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New Typologies / The Interlace (Private housing for upper-midieum income

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3. Cohesive Communities
Hardware Software Heartware
- Integrate the communities.
- varying types of flats for
households of different
income and social profiles.
- Open/void ground floor.
- The Residents’ Committees
(RCs) Centre.
- Playgrounds, fitness corners
and precinct pavilions.
- Commercial and recreational
facilities.
- Promoting extended family
living.
- Multi-Tier Family Housing
Scheme.
- Married Child Priority
Scheme.
- Third Child Priority Scheme .
- Ethnic Integration Policy
(EIP). This creates a balanced
mix of residents from various
ethnic groups.
- enhance the sense of
belonging in HDB towns .
- Instilling a stronger sense of
ownership in residents.
- Involve residents in the
management of HDB estates.
- participate in the decision
making process.
- Involved in shaping the
physical environment.
- forums, consultation, and
regular surveys.

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Void Spaces’ activities (elderly care, meeting, parties, ..est.

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Policies’ Outcomes…
1. UNDER THE LEE KUAN YEW GOVERNMENT, 1959 – 1990:
 Improvements in the urban environment and the standards of housing in
Singapore .
 success of the economic development and housing strategy .
 squatter settlements were cleared and entire neighborhoods and villages
were resettled in HDB new towns.
 Increase in Savings Rate.
 Increase in Quantity and Quality of Housing Stock.
 Increase in Homeownership Rate.

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 Development of Mortgage Market
 Racial Integration
 Impact on Economic Distribution
2. The Goh Chok Tong Government, 1990 – 2004:
 The housing shortage problem was solved.
 Housing policies under Goh Chok Tong’s term as the Prime Minister were
marked as market deregulation, “asset enhancement” and “upgrading” policies.

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3. The Lee Hsien Loong Government, from 2004:
 Hold off increasing housing supply which subsequently led to a housing
shortage in 2010.
 Elderly Households: Monetizing Housing Assets: the Lease Buyback Scheme
(LBS) in 2009 to allow the low income elderly (age 63 or older) living in 3-room or
smaller flats to unlock the equity in their homes.
 Lower Income Households: Additional and Special Housing Grants.
 Property Investors: Curbing Housing Investment Demand.

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Problems & Challenges …
1. Crowding out.
2. Housing sector impacts.
3. Consumption inefficiencies.
4. Retirement financing.
5. Lack of unemployment insurance.
6. Financial Sector development.
7. Governance issues.
8. Un-equitable social engineering.
9. Speculative gains eroding work ethic.
10. Policies impeding talent attraction.
11. Politicization of HDB.

For Listening …..
5/6/2015 38

Singapore's housing policies

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