Public housing units in Singapore now sell for $1 million

September 2, 2022

Singapore, which is one of the world’s most expensive cities to live in, is now selling government-built apartment units for over 1 million Singapore dollars (approximately $714,490).

Officials are now currently discussing new measures to address the rising prices in the city-state’s public housing system, which are reportedly due to COVID-19-related construction delays.

Under Singapore’s public housing system, apartment units known as Housing & Development Board (HDB) flats are directly sold to citizens on 99-year leases. The program has proved successful, resulting in over 80 percent of residents living in HDB flats– one of the highest home ownership rates in the world.

Since homeowners are allowed to transfer ownership to Singaporean citizens and permanent residents after five years, a thriving resale market has emerged.

Those who originally purchased HDB flats for around 500,000 Singapore dollars (approximately $357,225) are now selling them for double the price.

Based on official data, a total of 259 public flats were sold for 1 million Singapore dollars or more in 2021. This year’s figures already reached around 230 last month.

At least two HDB units have surpassed the million-dollar mark – one of them was a 1,313-square-foot unit that sold for around $1.4 million Singapore dollars (approximately $1 million) this year. The unit, which has 92 years left on its lease, is situated near schools and train stations.

Clarence Long, the property agent who helped sell another million-dollar HDB flat back in May, noted that a private condo of the same size and location could fetch around $1.78 million.

“Million-dollar HDB flats are here to stay, as there will always be people who like to live in central locations or larger spaces,” he was quoted as saying.

In Singapore, private condos come equipped with security guards and amenities such as swimming pools and gyms.

While buyers may choose to buy off-plan HDB Built-To-Order (BTO) public flats for about 300,000 to 700,000 Singapore dollars (approximately $214,340 to $500,122) directly from the government, many aspiring homeowners end up looking into buying from the resale market as most of the BTO projects are already overly subscribed and take around five years to finish construction.

Last month, Singapore’s Ministry of National Development talked about the government’s plans to ramp up the supply of new BTO flats to address the increasing demand. The government also announced cooling measures in December, which include raising stamp duties and tightening loan limits.

The government has also started implementing measures to help residents cope with higher prices for daily necessities brought about by the surging inflation.

Experts predict the tight supply could ease up in early 2023.

Featured Image via Housing & Development Board

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