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Singapore

Analysts say housing shortage to continue as they wait for details of government housing plan


Asked to comment on the housing outlook in Singapore, Dr. Chua Yang Liang, Jones Lang LaSalle’s Head of Research & Consultancy at Jones Lang LaSalle said that immigrants are contributing a lot to the lack of housing in Singapore.

“The current housing situation is partly shaped by the lack of housing over the past couple of years to meet new arriving immigrants. Based on our in house estimates, the calculated gross average household size islandwide rose from 3.9 in 2005 to about 4.5 in 2010. This gross household size naturally does not take into consideration the different housing arrangements among foreign in different industries – a key weakness of this indicator. All it does is paint a broad picture of the housing versus population conditions. “

He then predicts this ‘demand overhang’ to continue in the short to medium term.

“We reckon the state needs to continue to support the public housing with sufficient stock to ease this demand. As to the exact number required, that depends on the future immigration policy and population target. We reckon the “demand overhang” is likely to continue in the short to medium term; supporting the housing activity both in the public and private market over the short term. While the supply condition in 2013/2014 is substantial, the backlog of housing demand could provide the support in the market; bringing down the overall gross household size. Policy risks however remain moderate to high over this period and are likely to keep property price growth in check.”