SINGAPORE – Private residential property in Singapore is now the most expensive in the Asia-Pacific in terms of absolute prices, overtaking that of Hong Kong in 2022, according to a report released by the Urban Land Institute (ULI) on Tuesday.

ULI said the median price of Singapore’s private homes now stands at US$1.2 million (S$1.6 million), compared with Hong Kong’s at US$1.16 million. In the next highest market, Sydney single-family homes are a median US$980,000.

Singapore’s median private home prices rose about 8 per cent in 2022, whereas those in Hong Kong fell almost 9 per cent amid strict Covid-19 curbs, the report said.

On a per-square-metre basis, though, Hong Kong’s is still the most costly private housing market in the region by far.

In 2022, the average price per square metre for a private home in Hong Kong was US$19,768, equivalent to US$1,836 per sq ft, or S$2,488 per sq ft – more than twice the median figures for cities such as Singapore, Tokyo, Shenzhen, Beijing and Shanghai.

In general, home ownership in Singapore is high at 90 per cent and is accessible due to the large supply of public housing, ULI noted.

“In contrast, other gateway cities such as Hong Kong, Shanghai, Tokyo and Seoul have relatively low home-ownership rates, reflecting high home prices and the more migratory nature of the populations in gateway cities,” it said.

But the affordability ratio of Singapore private homes now stands at 13.7, placing them in the unaffordable range, said ULI.

Home ownership is considered unaffordable when the ratio of the median home price to median annual household income exceeds five. Across the cities tracked by ULI, median annual household income is highest in Singapore at US$87,900.

Shenzhen homes rank as the least affordable, with a ratio of about 35, while Hong Kong’s ratio has fallen to 26.5.

Data compiled by ULI showed also that the median price of a resale Housing Board flat rose 7.9 per cent from US$379,000 to US$409,000 in 2022. With that, the affordability ratio of HDB resale flats has crept up from 4.5 to 4.7.

Still, including public housing, Singapore housing is ranked “most attainable” in ULI’s 2023 Asia Pacific Home Attainability Index.

“Meanwhile, home attainability is severely challenged in Tier 1 and leading Tier 2 cities in mainland China, Hong Kong, Metro Manila, Metro Cebu, Ho Chi Minh City and Danang, with median home prices at approximately 20 to 35 times median household income,” ULI said.

In rentals, Singapore’s private homes chalk up a median monthly rent of US$2,596, which is 53 per cent higher than Hong Kong’s median monthly rent of US$1,686 and overtaking other high-cost-of-living cities like Tokyo (US$602) and Seoul (US$689).

This comes after Singapore’s median monthly rents increased by 29.7 per cent in 2022.

Factors such as construction delays, a sudden surge in the number of migrants and a relatively limited stock of institutionally or individually owned rental properties have contributed to the rising market, said ULI.

The median monthly rent for private homes in Singapore represents 35 per cent of the overall median household income.

“However, as most renters of private-sector homes (in Singapore) have higher-than-median income, the monthly rent amount should be a significantly smaller percentage of the renter’s monthly income,” ULI noted. THE BUSINESS TIMES