According to the most recent Home Attainability Index, Singapore’s private rental homes have the highest monthly rent in the region, at $2,600, surpassing other cities like Sydney, Melbourne, and Hong Kong.
Home prices in Hong Kong have “dropped considerably” in 2022, refering to the huge increase in mortgage interest rates as it stays up with the U.S. Central bank.
A new report says that private homes in Singapore are now the most expensive in Asia-Pacific, surpassing those in Hong Kong.
The Urban Land Institute (ULI) Asia Pacific Centre for Housing’s Home Attainability Index revealed that Hong Kong’s private home median price was $1.16 million in 2022, while Singapore’s private home median price was $1.2 million.
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The report attracted on government measurements from 45 urban communities nine business sectors in Asia-Pacific — while estimating home feasibility for both house buying and home rentals corresponding to the middle pay of families.
As interest rate increased borrowing costs, Hong Kong’s home prices plummeted to a five-year low in October 2022.
Following the U.S. central bank’s increase in the fed funds rate from 5% to 5.25 percent earlier this month, the monetary authority in Hong Kong increased the base interest rate to 5.5 percent.
According to the ULI report, Hong Kong’s median home price decreased by 8.7% from $1.27 million in 2021 to approximately $1.16 million in 2022 due to “a net outflow of population” and a “less optimistic view” of the local property market.
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Meanwhile, Singapore’s private homes surpassed Hong Kong’s as the most expensive in Asia-Pacific, with the median price increasing more than 8% in the previous year.
Concerned that rising prices “could run ahead of economic fundamentals,” Singapore recently increased property purchase taxes.
Most Expensive Cities For Private Homes In Asia-pacific City Median Housing Price Per Unit:
SINGAPORE –$1,200,087
HONG KONG –$1,155,760
SYDNEY– $980,209
MELBOURNE –$716,200
SHENZHEN– $626,964
Meanwhile, the Singapore government said local and foreign buyers of residential properties will have to pay higher taxes, known locally as additional buyers’ stamp duties.
However, the report added that Hong Kong’s private homes are still the most expensive on a per square meter basis — costing $19,768 and “well over twice” the median figures for Singapore, Shenzhen and Beijing.
Singapore’s private rental homes have the highest monthly rent in the region, having increased by nearly 30% in 2022.
ULI attributed the increase in rent and home prices to various factors such as an increase in migrants, a slowdown in building completion and young professionals moving out of their multi-generational family homes for more space and freedom.
According to the report, private home prices fell in Sydney and Melbourne as more people moved back to regional cities and 11 “unprecedented” interest rate hikes occurred in a year.
However, the median monthly rent for houses and apartments in Sydney, Melbourne, and Brisbane increased. The monthly average for house rentals in Sydney was $1,958, while the average for apartment rentals was $1,732.
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Since the end of COVID-19 in 2022, there has been a reversal in population movement toward capital cities. The country’s rising median rent was probably due in part to this.
Singapore has the highest homeownership rate in the region, at 89.3%, despite the fact that private homes there are the most expensive in the region.
This is despite the fact that median HDB prices will rise by 7.9% between 2021 and 2022, and the ratio of median HDB prices to median annual income will also rise from 4.5 to 4.7. The public housing authority in Singapore is HDB, or the Housing Development Board.
In Singapore, the ratio is 13.7 for private residences.
According to the report, homeownership is generally regarded as unaffordable if the ratio of the median home price to the median annual household income is greater than five.
This means that only HDB apartments in Melbourne and Brisbane, Australia, and HDB units in Singapore are considered affordable.
In terms of home attainability, mainland Chinese cities rank among the lowest, as did the index from last year.
The report noticed that the homeownership rate in China has “declined considerably” in the past 10 years.
“The cities’ home attainability is directly tied to the amount of new housing supply relative to increase in population,” it added.
“For Shenzhen, its population increased by more than 7 million in the 12-year period from 2010 to 2022, yet its new housing stock increased by only 31 million square meters, the smallest increase among Chinese cities during the same period.”
