What Can America Learn About The Housing Crisis From Singapore’s System?

Whether you’ve tried to rent or buy a home recently, you’ve likely been faced with the twin problems of limited availability and shockingly high prices. This ongoing crisis is playing out across the U.S. and around the world with few prospects for a short-term solution.

But some advocates are pushing for more public housing, or at least a public-private partnership that could cap prices and increase availability. Would such a system work in America?

In an attempt to answer that question, let’s take a look at how it’s been handled in one Southeast Asian nation.

A brief history lesson

Singapore was beset by extreme poverty and unsustainable overcrowding during its first years as an independent nation. That presented many unique housing challenges that have taken decades to address.

But now, much of the nation is prosperous and many of its citizens have spacious and comfortable places to call home. Roughly half of Singapore’s 6 million citizens are living in apartments that were built and subsidized by the government.

Despite receiving public assistance, most of the residents consider themselves the owners of their affordable homes.

Upside vs. downside

In some ways, Singapore is a victim of its own success. If the U.S. hopes to replicate the positive attributes of this subsidized housing system, it should beware of the related pitfalls.

Most notably, there’s been a significant uptick in purchases by secondary buyers, which has served to push the prices of these apartments to new heights. More than 50 units have recently sold for the equivalent of $1 million or more.

And “ownership” is a misnomer. In actuality, these are 99-year leases after which time the government retains possession. That has caused many residents to worry that as the deadline draws nearer, the value of their apartments will plummet.

Chris Agee May 25th, 2024

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