The Housing Market Of Singapore Economics Essay Cities are engines of growth. With more than half the world’s population now living in cities and increasing, this will exert enormous pressure on housing, services, infrastructure and the environment. Like many other cities, Singapore faced similar urban challenges. Singapore is an island city state of just 700 sq km with virtually no natural resources. The nation state required to pack in all the needs of a country and accommodate some 5 million people within the island (Cheong Koon Hean, 2010). Singapore adopts a long term and comprehensive approach to planning. It starts with formulating the Concept Plan, a strategic land use and transportation plan that sets the longterm development directions for Singapore over the next four to five decades. This strategic plan is cascaded into a Master Plan with a shorter 15 year time frame. The Master Plan provides clear planning parameters to guide developments and help prioritise investments in This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order public infrastructure (Cheong Koon Hean, 2010). Despite Singapore government has been planning decades ahead, the country is facing the unbalanced housing supply and demand during pass decade. Housing is one of man’s most basic needs. Yet in many countries, decent housing is beyond the reach of many. When the HDB was formed in 1960, its pressing challenge then was to solve the huge housing shortage for Singaporeans. 50 years on, HDB has succeeded beyond expectations and received numerous international accolades for its achievements. However, determining the right housing supply for the short term will always be a difficult call, and need to strike a delicate balance. Economic conditions and sentiments can change much faster than any building plan. So, while planning the housing supply to broadly meet longer term needs, there is also a need to build in some buffer to deal with short-term fluctuations (Mah Bow Tan, 2010). Therefore, Singapore government needs the solution to stabilize housing supply and demand while maintaining the growth of the country. In Singapore, home ownership is well segmented into private homeowners and public homeowners. The public home ownership sector is the dominating sector accommodating 85% of total households (Housing and Development Board, 2002). During the past four decades, along with Singapore’s rapid economic expansion, major structural changes are evident in the country’s demography strata as well as economic framework. The nature, provision and financing of housing are therefore products of such socio-economic development. For instance, the housing tenure structure has undergone drastic structural changes since 1970. Public homeownership has become a major sector while the private rental sector, which used to be the dominating sector, has become very diminutive in the current tenure structure (United Nations Human Settlements Programme 2011). The public housing sector in Singapore is managed by a statutory board known as the HDB (Housing Development Board) who is sole authority to control and implement public housing production and management initiatives, subsidies and financing measures as well as specific programs and policies. The public homeownership sector is divided into three sub-markets, namely, the new public housing market, the resale public housing market, and the Executive Condominium market. While the new and resale public housing markets target the low and middle-income households, the Executive Condominium market aims to provide high quality condominium housing for the upper and middle-income households. Although the dwellings within the three sub-markets are constructed similarly in high-rise high-density developments with 99 years leases, the new and resale public housing are differentiated from each other by the locations, dwelling sizes, ages and designs, and also from the Executive Condominiums in terms of the locations, dwelling sizes, ages and designs as well as facilities and amenities. As HDB has the sole authority and responsibility to provide subsidized public housing, it is financed through two main types of loans, namely, housing development loans and mortgage financing loans. The housing development loans are basically to finance the public housing construction and development programs and operations that are carried out by the HDB. On the other hand, the mortgage financing loans are loans given to the HDB by the government so that it could provide mortgage-financing facilities to purchasers of public housing at a subsidized interest rate. In terms of the housing market, many researchers have explored it from the perspectives of demand and supply. The many determinants of housing demand and prices include net household formation, level of income and real income growth rate, availability of housing substitutes, price of housing relative to the price of other goods, economic growth rate, expectation and level of confidence, unemployment rate, stock price index, real after-tax interest rate, lagged real appreciation, inflation rate, supply of housing, construction cost as well as the difference between actual and equilibrium real house price levels (United Nations Human Settlements Programme 2011). In the early years, HDB adopted a zonal pricing system, where the price of each new flat was fixed according to geographical zones. Pricing largely took into account the cost incurred in building the flats and the same price was charged for a given flat type within the zone, regardless of its actual location and attributes. Back then, there was practically no open resale market. In our study we tend to adopt a more qualitative approach, housing and This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order economic policy development, their implications and impact on the housing markets in Singapore are examined in a series of qualitative discussions. Another major influence on the housing market is that of government intervention, activity and influence. In a perfectly competitive economy, the supply of goods and services of the economy and the set of prices are determined by the price mechanism in accordance with consumers’ preferences and incomes. However, in reality, markets often operate under circumstances that do not confine to the assumptions of perfect competitive markets. Left to the market alone, the market system is unlikely to be efficient. Given the presence of market failure, governments in most countries have perceived the need to intervene in the markets and thus correct the market failure or introduce policies or measures to compensate its effects. The government has actively intervened in the public and private housing markets in Singapore in several ways that could be categorized in terms of regulations, direct provision, and subsidies. Although the current system of public housing operations and financing in Singapore has been shaped through successive waves of public housing policies and economic development, its main objective of promoting public homeownership has not changed. The development and success of the Singapore public homeownership program, which started in 1964, is basically supported by a number of strategic public housing policies and regulations. The existence of the public housing market in Singapore is the manifestation of the government’s commitment to provide decent housing for its population. In view of the dire housing shortage and unsanitary living conditions before the 1960’s, the government has chosen to directly provide housing through the HDB as this is the most efficient and effective way to increase the housing stock. HDB plans and construct public housing based on 5-year building programs. One of the major policies that encourage public homeownership is the provision of mortgage financing loans by the HDB. This research will focus on the main and sub-questions to collect primary information and data according to the research topic. This main research question is the overall picture of the whole research area and which will be analysed and defined by sub-questions. How can Singapore meet the increased demand for housing by the year 2020? Why doesn’t the Government build more flats? How can government balance population and housing in Singapore? What are the factors that affect the supply and the demand for housing? What strategies can they introduce? Since the research topic and questions require both statistic and theory, the proposed research method will be mixed-method of quantitative and qualitative. The quantitative method will be used to analyse the information and data from statistic records and qualitative method will provide the analysis of the information from questionnaire which will be distributed to home buyers, developers, contractors, consultants and MPs. The main objective of the research is to investigate the problems related to unbalanced housing supply and demand so as to understand how to maintain the balance. This paper will analyse housing supply and demand only within Singapore base on the knowledge and understanding obtain from collected information and data. Since Singapore economy is very much depend on the world’s economic trend, there is a limit to forecast the impact of economy and growth on housing supply and demand. The information and data will be obtained from published work except the information from questionnaires. Introduction of the research topic, research questions, research methods, objectives and limitations of the research. Review of the literatures which are related to housing supply and demand in Singapore. Discuss research plan/ case studies and demonstrate the design of a suitable collection instrument intended to collect primary data for the research. Provide a short summary of the research topic, the issues identified, and the research design. In the previous chapter, the background of the housing supply and demand has been introduced and highlighted the housing system, market and government interventions which influence the supply and the demand of housing in Singapore. As currently Singapore encounter shortage of hosing supply, the research focus to find the solutions on “how can Singapore meet the increased demand by 2020” despite there is limited land. The Singapore private housing market has experienced dramatic price movements over the This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order past 5 years. Traditionally, public housing production and the release of state-owned sites for private housing have been important policy levers for mitigating house price inflation. However, imbalances in the housing sector after the Asian Financial Crisis led to cutbacks in the supply of new public housing units and development land by the state. At about the same time, Singapore began the liberalization of its financial system and adopted progressively accommodative immigration policies which increased its attractiveness to capital and immigrant inflows. As fundamentals improved amid ample liquidity and as its foreign population grew, consumption and asset demand for housing expanded rapidly. However, new flat production and land sales remained curtailed despite revisions to the public housing allocation mechanism and the state land sale system in 2001 that were intended to improve their responsiveness to demand shocks. Without a commensurate supply-side response, house price appreciation in Singapore was among the highest worldwide, both before and after the Global Financial Crisis. This triggered four consecutive rounds of prudential and fiscal measures since September 2009 to moderate house price volatility. Their impact has been muted, attenuated by other drivers of market activity and by a shortage of public and private housing (Lum Sau Kim, 2011). Beginning in 2010, the state has aggressively ramped up its supply of public housing and the quantum of state land sales. While this would reduce the housing deficit in the medium term, there is an urgent need to address weaknesses in the design and implementation of the state’s supply levers given the limited effectiveness of prudential measures in an open economy like Singapore’s. Singapore Government has been monitoring closely on the supply of housing matter. Mah Bow Tan (2010) mentioned that as we progressed from a nation of home seekers to home owners, the situation changed. Demand became more volatile. Many, even those with existing roofs over their heads, could now easily join or exit the queue. At the height of the property boom in the mid-90s, there were as many as 150,000 buyers in the queue, and the wait for a flat was as long as seven years. However, when the Asian Financial Crisis struck in 1997, the queue vanished, virtually overnight. HDB ended up with 31,000 unsold flats, which took more than five years to clear. Because of the unintended oversupply, home buyers could walk in to buy ready flats in the early 2000s. However, home owners paid a heavy price, with flat prices staying depressed. Some who bought flats just before the crisis ended up with negative equity and even lost their homes and hard-earned savings. The many unsold flats represented a waste of taxpayers’ money. The holding cost incurred was money that could have been spent on healthcare, education, or other areas. In order to balance the population and housing supply in Singapore, the Government has implemented various strategies immigration policy to control the influx of foreigners such as tighten the requirement of application of Permanent Resident. And recently MOM (Ministry of Manpower) has taken further measures to moderate demand for foreign manpower by increasing qualifying salary for the Employment Pass for foreign professionals to work in Singapore, while applicants would have to commensurate with the work experience and quality they are expected to bring. Concurrently, educational qualifications requirements will be tightened. Besides that, Government also implement measures to control the supply and demand of housing requirement such as increase supply land sale and building more of BTO (Build To Order) flats to cater the demand of young generation of Singaporeans who are starting to form a family. Furthermore, Singapore government immigration policy on influx of foreign talent and expertise has been tightened and restricted recently; the demand of housing could be reduced which make a huge dampen effect. In order to increase the population size, Singapore government should consider encouraging cross-marriages between foreign talents and local Singaporeans. Since Singapore is a small nation in terms of size, the government has been trying to attract the best local and international talents who are creative and innovative to help develop Singapore further. In order to balance population and housing, prioritize to strategize on factors that affect supply and demand for housing. Given Singapore’s constraints, planning for sustainability is a necessity and a matter of This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order survival, not a choice. Research on housing supply has grown due to improved data combined with heightened interest in policies such as local land use regulations. Singapore is a densely populated city-state. With a 5.18 million population on the 683 square kilometres, housing need is one of the key social indicators in the country and is well managed by the Government. Home ownership is an important element of the government’s housing policy. As recorded in then Prime Minister Lee Kuan Yew’s autobiography: “My primary preoccupation was to give every citizen a stake in the country and its future. I wanted a home-owning society.” The Singapore housing market is segmented into three sub-markets: the HDB new flat market, the HDB resale market and the private residential property market. Public housing sector, as the dominant sector, accounted for 82% of the total housing stock in 2010. It also accommodates 82% of the total population. Public home-ownership reached the very high 88.6% by the end of 2011 (Yearbook of Statistics, Singapore 2011). The private residential property sector, though it accounts for only a small proportion of the total housing stock, claims almost half of the nation’s housing wealth (Phang, 2001). Today, 82 percent of Singapore’s population reside in high-rise flats designed and built by the Housing and Development Board (HDB). Some 92 percent of HDB’s residents own their apartment units, leaving only eight-percent as tenants. In Singapore, Housing and Development Board (HDB) is the major provider for homes; it is the sole authority responsible for physical planning and implementation of public housing development, and the major developer within the nation, providing affordable lower-income and middle-income housing for sale or rent , as well as furnishing estate management services. As flow of new land is exogenously decided by the government, the author investigated how a land supply shock affects the housing market. They proposed two hypotheses: (i) Based on a myopic expectation, a sudden scarcity of expected future land supply reduces new construction and hence drives up the house price; (ii) Based on a rational expectation, a sudden scarcity of expected land supply directly alters house prices. A reduction in land supply induces expectation of higher future rental and land prices. In a rational market, these anticipations are capitalized into higher current house prices. Under this hypothesis, land supply should not only enter the supply function, but also the demand function. The supply of residential units in the pipeline continues to build up. As at the end of 2nd Quarter 2011, there was a total supply of 71,111 uncompleted private residential units from projects in the pipeline6, higher than the 68,887 units in 1st Quarter 2011. Of the supply in the pipeline, 33,899 units remained unsold as at 2Q2011. The unsold units comprised 10,309 units in CCR, 7,610 units in RCR and 15,980 units in OCR. A total of 4,802 uncompleted private residential units were launched for sale by developers in 2nd Quarter 2011, compared with 4,130 units in 1st Quarter 2011. At the same time, 4,325 uncompleted private residential units were sold by developers, compared with 3,430 units in 1st Quarter 2011. Developers also sold 119 completed private residential units in 2nd Quarter 2011. Sub-sales accounted for 7.4% of all sale transactions in 2nd Quarter 2011, lower than the 8.3% recorded in 1st Quarter 2011. The stocks of private residential units increased by 2,054 units in 2nd Quarter 2011. At the same time, the vacancy rate of completed private residential units increased from 4.9% as at the end of 1st Quarter 2011 to 5.1% as at the end of 2nd Quarter 2011 Peng and Wheaton (1994) argued that as there is always excess demand for the government subsidized public housing, there is a near zero vacancy rate in the public sector. Given excess demand for public units, small changes in public housing prices have little or no impact on the private housing market. The major impact is from the demand side, that the quantity of public housing stock alters the number of households who seek housing in the private sector. In their case, people that dwell in the public sector are ruled out from seeking housing in the private sector. Government policy can have a profound impact on the operation of the housing market. This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order Quigley and Raphael (2004a) found evidence that the degree of regulation governing land use and residential construction dampens the supply side adjustment when the market encounters a demand shock. They also found a positive relationship between the degree of regulatory stringency and house prices (see also Malpezzi, 1996). Mayer and Somerville (2000b) showed in their supply equation that land regulation lowers the level of new construction and price elasticity of supply. Difficulty of measuring government policy is still a problem in the housing literature, though various indicators have been proposed like the cross-metropolitan regulatory indicators constructed by Malpezzi (1996) and the international regulatory indicators by Angel (2000). Public housing and unsubsidized housing stocks grow together in the long run. Murray (1999)’s article suggested that in an attempt to analyze the housing supply in the private sector, we need to take account of influence from the public sector and vice versa. This might be especially relevant for housing markets in places like Singapore and Hong Kong which contain a dominant public housing sector. Local research has tried to build a structural model for the private residential property market. In Lum (2002), instead of modelling the demand and supply separately, the author directly estimated a reduced-form price equation as a function of income, mortgage rate, construction cost and quantity of government land sales. One criticism of Lum’s model is that population factor was missing in the long-run price equation. As Smith (1969) argued, in the short run, population increases may be accommodated in a relatively fixed housing inventory by varying intensity of occupancy. But in the long run, especially under conditions of rising real incomes, population growth is a vital factor in determining the level of demand. A number of studies tested whether there is a positive housing wealth effect on consumption in Singapore, which has been found to be true in OECD countries (See Case et al., 2001, Abeysinghe and Choy, 2004, 2007 among others). There exists ambiguous conclusion among different studies. Phang (2004) found no significant housing wealth effect on aggregate consumption in Singapore. Abeysinghe and Choy (2004) analyzed the effect of house prices on the financial assets and housing loans of Singapore households. They used a loan variable to capture the negative effect on consumption of an increase in house price, which they termed as price effect. Edelstein and Lum (2004) separated the wealth effect of the public housing and private housing and, as with Phang (2004), found that there is no significant private housing wealth effect. However, they noted that the rise in HDB resale prices does have a significant pumpup effect on aggregate consumption. Housing supply positively responds to the GDP growth rate, an indicator of the soundness of the macro-economy. Negative coefficient for the change in the vacancy rate shows that excess housing supply, signaled by a high vacancy rate, stops suppliers from building more houses. Studies have shown that the private sector is heavily influenced by the dominant public sector. Phang and Wong (1997) and Phang (2001) provided evidence that the availability of HDB housing loans and CPF housing withdrawals has the most significant impact on the private housing price among all the housing policies from 1975 to 2004. Ong and Sing (2002) studied the interaction between the public and the private sector, with a focus on the price discovery mechanism. They tested two hypotheses which are upgrading hypothesis and market-force hypothesis. The upgrading hypothesis states that the public sector leads the private sector because home-owners are able to upgrade from public housing to private housing as a result of the capital gain of selling their subsidized HDB flats in the resale market. The market-force hypothesis states that the private sector leads the public sector as the latter is regulated by the government in contrast to the market driven private sector. Therefore, macroeconomic shocks are likely to affect the private sector first. Their empirical results concluded that there is a bi-directional causality between the private and the public housing market and the leading force from the private sector to the public sector is stronger. To conclude, several gaps can be seen from the existing housing models in the local literature. More efforts are needed to build a general structural model for the Singapore This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order housing market, which can account for the population factor, the user cost of homeownership, expectations, the vacancy rate and interaction of the public and the private housing sectors. Central Provident Fund (CPF) is a factor which influences the supply of housing. CPF is a tax exempt compulsory savings fund. Under statute, the employees are required to save a certain portion of their monthly income in a CPF account. At the mean while, the employers also make monthly contribution to the employees’ CPF accounts. The current CPF contribution rates for employees and employer are 20% and 16.5% respectively. CPF savings is a huge sum of capital to finance development including public housing. The capital budget of public housing which under Housing Development Board (HDB) has funded by low interest loans from the government through CPF mechanism represents over a third of the government’s development estimates in the state budget. HDB has been financed and implemented within the limits of national resources without recourse to foreign funds (Mohammed Razali Agus, John Doling and Dong-Sung Lee 2002). There are three separate accounts for CPF savings which are the Ordinary Account, Medisave Account and Special Account. Employees are entitled to withdrawn certain amount of CPF saving under Ordinary Account when purchase of public housing. It means CPF saving provides a source of mortgage financing to help home buyers meet their mortgage payment in term of down payment and monthly instalments. CPF contribution rates and HDB flat prices are match closely to the rates of wages. HDB offers housing loans to all HDB flat buyers with an interest below market rate in order to purchase a flat without suffering a reduction in monthly possible income. In view of this, housing demand in Singapore is greatly affected by CPF saving. Real house prices are directly determined by the willingness of households to pay for (and willingness of builders to supply) a constant-quality house. Changes in the quantity of housing demanded will affect real prices only to the extent that the long-run housing supply schedule is positively sloped. The total derivatives which carry along with age all of the average characteristics such as income, marital status and education associated with that age-demand results. (Mankiw and Weil 1989) To obtain estimates of the demand per household, we take the dot product of the age distribution of the population and amount of housing demanded by each age group according to our total and partial derivatives; First, the impact of demand on price depends on the supply elasticity of houses. With an infinite elasticity of supply, demand is (R. Green, P.H. Hendershott / Reg. Sci. a ) irrelevant; price is determined solely by supply conditions. Second, even with a significantly less than perfectly elastic supply, factors other than our demand variable affect real prices. Numerous investigators have attributed a major role to changes in real after-tax interest rates and technological changes in housing construction could be important. Third, if markets are efficient, only changes in market demographic demand forecasts should effect real prices] Of course, the underlying premise of Mankiw and Weil (1989) is that housing markets are not efficient and, in particular, that markets did not efficiently process the known aging of the baby-boomers. The age of potential buyers can also affect housing demand. In general, an area with an ageing population will have less demand for new housing than one where new, younger households are being formed. On the other hand, an area with a disproportionately young population can place heavy demands on educational facilities – sometimes at the developer’s expense. Age also determines the type of housing that will be required. An area with large numbers of elderly people, young singles, or young married people may be ripe for apartments or condominiums. An area with families headed by people in the 30 to 55 age group is more apt to prefer single-family housing. 2.4.3 Meeting Genuine Housing Needs In March 2012, HDB launched 7,978 flats for sale under the Build-To-Order (BTO) to substantial housing demand in Singapore. (HDB, Press Releases, 28 March 2012) HDB has ramped up flat supply substantially to meet housing needs; estimate 50,000 units in various parts of Singapore (26 towns and estates) will provide wider choice and meet the This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order diverse needs and aspirations of home buyers in next two years. Bachelor of Applied Science in Construction Management Intake 28-Group “G” Household income from work increased for all income groups, in tandem with strong employment creation in 2011, (according to the Singapore Department of Statistics’ latest report on “Key Household Characteristics and Household Income Trends, 2011”). Among resident employed households1, median monthly household income2 per household member rose from $1,850 in 2010 to $1,990 in 2011, an increase of 7.9 per cent in nominal terms, or 2.7 per cent in real3 terms. The first deciles saw the highest percentage growth in average monthly household income per member of 11 per cent and 5.8 per cent in nominal and real terms respectively. On a total household income basis, median monthly household income from work increased from $6,340 in 2010 to $7,040 in 2011, an 11 per cent growth in nominal terms, or 5.6 per cent in real terms. The tenth deciles saw the highest percentage growth in average monthly household income of 14 per cent in nominal terms, or 7.9 per cent in real terms. Cumulatively between 2001 and 2011, the median monthly household income from work per household member of resident employed households rose by 20 per cent in real terms, with most of the gains coming from 2006 to 2011. On a total household income basis, the median monthly household income from work rose by 22 per cent in real terms between 2001 and 2011. The Department of Statistics has completed the development of annual income-based estimates of GDP1 or GDP (I). The income approach estimates Gross Domestic Product (GDP) as the sum of the incomes receivable by each institutional sector from the domestic production of goods and services. Overall residential demand in a local area is determined by the interaction of household preferencs and expenditures (demand) with the quality and availability of existing inventories (supply). Within overall demand patterns, the type of housing is a function of the household characteristics (age, family size, incomes, lifestyle preferences, and so on), housing density patterns (zoning, land values, transportation systems, and so on), and costs of production (land, labor, materials, infrastructure, and so on). On a more practical basis, these patterns are further influenced by mortgage costs and availability, developer capabilities, government tax policies, environmental pressures, and myriad other factors that may vary from area to area and period to period. An interesting feature of condominium development and growth in Singapore is its close link with the performance of the Republic’s economy. As a global city with excellent international links, the Singapore economy is particularly susceptible to external economic influences and therefore highly volatile. These rapid changes in the economic fortunes of the Republic affect the performance of the property market and this is clearly reflected in the condominium market. From the inception of the condominium concept to the present, three phases of development and growth linked to the performance of the property market and the economy can be identified: the pre-boom and early condominium development; the boom and rapid growth; and the slump and consolidation. The demand and popularity of condominiums have risen in the early 1980s following a rapid growth of Singapore’s economy. The growing affluence of Singaporeans, coupled with the strong influx of multinational corporations and foreign talents, fueled the demand for Public and Private Housing. Public Housing in Singapore: Since 1960, the Housing and Development Board (HDB) in Singapore plans and develops quality public housing and its related facilities. Today, some 85% of Singaporeans live in HDB flats. These ranges from 3-room flats at about 800 sq ft to executive flats at about 1600 sq ft and these are located all over the island. Public housing in Singapore can be categorised into the following types (a) New flats The primary acquisition avenue is through the purchase of new flats directly from the HDB. Over the years, various forms of sale programmes has been in place, with the current mode of sale known as the Build-To-Order (HDB) programme launched in 2001. (b) Build-to-Order (BTO) The Build-To-Order (BTO) is a responsive system offering flexibility in location and timing for flat buyers. For Eligible buyers (planning to shift into a new HDB apartment in the near future) This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order can apply for apartments in their preferred location from the specific sites launched (c) Design, Build & Sell Scheme (DBSS) The Design, Build and Sell Scheme (DBSS) was introduced in 2005 to offer greater choice and wider variety to meet the housing aspirations of higher income flat buyers for better design and finishes. The involvement of the private sector in the design and construction of public housing and enables public housing to be more responsive to the needs and aspirations of Singaporeans. It has since been subsumed under HDB’s Premium Apartments, which comprises both Design & Build and Design Plus flats. (d) Executive Condominiums (EC) Executive Condominiums (EC) were introduced to cater to Singaporeans, especially young graduates and professionals who can afford more than an HDB flat but find private property to be out of their reach. ECs are comparable in design and facilities to private condominiums as they are developed and sold by the private developers. ECs are developed and sold by private developers. (e) Resale flats Existing flat owners are allowed to sell their flats on the open market to any eligible buyer at a mutually agreed price. While the HDB does not regulate these prices, the buyer and seller must declare the true resale price to the HDB. In addition, most flat owners may only sell their flat if they have met the Minimum Occupation Period (MOP) requirement, which was introduced to help reduce speculative activities. (a) Apartment Apartments are low or high-rise private residential buildings which typically have little or no common facilities (b) Condominium Condominiums are mainly mid to high-rise buildings that are more luxurious with their full facilities (covered parking, 24-hr security, clubhouse facilities; e.g. swimming pools, tennis/squash court, gym, etc.). (c) Townhouses Townhouses are a blend of landed terrace houses with the recreational facilities of condominiums. Townhouses can form entire estates, or can be part of a larger condominium establishment. (d) Landed Properties The variety of landed properties such as bungalows, semi-detached houses, or terrace houses which are the luxury of being an independent building on a plot of land. “To choose a house means to choose a lifestyle”, (Fleischer, 2007). A home is a final destination of all after a long day of a myriad of activities. To be precise, when one chooses a house, the safety and security, price and market value, quality, location, proximity to amenities, style and conveniency of travelling, for instance, commuting to work, are among top priorities for house purchases decision making. Consumer preferences affect the supply and demand of housing in Singapore. A better environmental state of attractive features of clean and green, more space and serenity spells the needs of consumers. Government intervention plays an important part in the allocation of housing supply. Current majority of flats and condominiums somehow demarket the various social status of individuals. Consequently, to encourage socialinteraction, new mix of housings today comprise of 1-room to 5-room Public Housing and various types of Private Housing, to meet the needs of consumers. The space one lives influence social relationships (Fleischer, 2007). Advance technology brings forth sky patios, integrated residential suites including SOHO (Small Offices and Home Offices) apartments, retail lifestyle mall and with MRT (Mass Rapid Transport), LRT (Light Rapid Transport) and air-conditioned bus interchange in the vicinity. 2.4.9 Impact of Influx of Foreigners To keep its competitive advantage (Sim et al, 2003) in the global market, Singapore must relentlessly upgrade its workforce in skills through education and in work attitude including life quality. The aging population and low birth rates now is overwhelming. In the 1990s, inflow of foreigners, at the initiative efforts of Government, makes Singapore their home. To maintain competitiveness in the global economy and attract investments, Singapore encourages elites of talents and skills to live and grow here. Throughout now, the influx of foreigners also raise the demand for housing that is yet met by supply as there is a lag between supply and demand. The foreigners’ population is premature before concrete housing supply could cater to their needs. Consequently, when supply is there, the aforesaid foreigners might have already migrate to another place as granting of permanent residency and citizenship has its criterion to meet. The gap to be bridged between supply and demand will require meticulous planning on the Government’s part. Ageing population is one of the main factors which influence the demand of housing in This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order Singapore. Based on the survey data from Singapore Department of Statistics (DOS) in 2005, it is expected to have an increase of 13.5% of the total number of resident population in Singapore that aged 65 and above in year; and the expected number of elderly will be increase to 873,300 in year 2030. By then, there will be one elderly out of every five residents (Committee on Ageing Issues 2006). The government recognised this ageing population matter seriously and resolving the shortcoming problems progressively in order to provide a better living for the elderly. In lieu of this, the demand of housing has increase indirectly. The government has implementing various measures to make homes more elder-friendly and there is a comprehensive range of housing schemes to meet the needs of the elderly. The government promotes the housing policies and programmes for current and future elderly by the following approaches:- a) Approach 1: Housing Policies and Schemes to facilitate mutual care and support by families b) Approach 2: Monetisation Options to enable elderly to unlock home equity for retirement income. Refer to Approach 1; the government has increase the monthly income ceiling level for extended families in order to give a flexibility to purchase new HDB flat. The extended families also allow to latter buying resale flats with the CPF Housing Grant. Besides that, married children are encouraging to stay with / near parents under the Married Child Priority Scheme and Higher CPF Housing Grant. For those who are single, the government has promoting the “Higher-tier Single” for the purpose of encourage single to live with parents (Yap Chin Beng 2009). These encouragement and promotions are helping the current and future elderly especially in the demand of public housing. Refer to Approach 2, the government encourages the elderly who have alternative place to stay with to sell or sublet their whole flat. By selling their flat, a full housing equity is available for their retirement needs. Elderly enjoys regular income and retain potential with further capital appreciation of flat by sublet their flat under HDB’s approved Subletting Scheme. The government has been promoting the Lease Buyback Scheme and provide subsidy to help the elderly who are aged 62 and above to stay in smaller flat to monetise their flat value (Yap Chin Beng 2009). From this scheme, elderly can receives monthly income and at the same time they can continue to live in same flat, community and environment. Recently, quite a number of elderly has downsized of their bigger HDB flat to smaller flat. Government has constructed quite a number of smaller flats in 3-room and 2-room in this few years in order to meet the demand of elderly need. For those elderly who has downsized their flat are entitled to $20,000.00 bonus from the government (Conrad Tan 2012). Currently, the government has introducing the Studio Apartment (SA) which is purpose-built small apartment complete with attractive designs, friendly fixtures and fittings for elderly who are at least 55 years old with the financial means to live an independent lifestyle and facilitate enhance ease of mobility and quality of life. The above-mentioned schemes have good result in resolving ageing population problems in the society currently but it is still insufficient for future. Due to the rapidly increasing number of elderly, the current provision might not be sufficient to cater the needs of future seniors who are better-educated and have higher standard of lifestyle and housing. Education level is another of the factors which influences the demand of housing. Due to increase of education level of Singapore residents, the expected living lifestyle is increase compared with previous generation. Because of this, the demand of housing must meet the basic housing need which providing better standards with some amenities. HDB has developed a range of flat design such as 1, 2, 3, 4 and 5 room flats, and executive condominium in order to improve the living conditions and to follow the current market trend required by the new generation population who are with higher education level. Living standard and basis requirement in term of design, layout, quality of works and the amenities of the surrounding housing estates are highly focus by the people who with higher This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order education level. Therefore, the quality of public and private housing is measured by the CONQUAS (Construction Quality Assessment System) score. However, the measurement of CONQUAS score does not do justice to accuracy and significance; maybe, consideration for defects should be increased in numbers instead of allocating the same zero marks for 1 number of defects to multiples of defects. For example, 100 marks for 100 numbers of defects signify defects need to be rectified and far from satisfactory to achieve quality; whereas, 100 numbers of defects given zero marks that is equivalent to a zero given 1 number of defects signify little to attainment of quality. HDB is in the process to review and understand fully the expectations and aspirations of the residents. Upgrading and redevelopment for the old housing estates are in the progress of construction rapidly. The purpose of upgrading and redevelopment is mainly to improve the standard of design and layout of the older flats closer to newer ones. Besides that, the value of the older flats is increasing indirectly. Those highly educated people interested to purchase those old housing estates only will happen when the upgrading and redevelopment works are completed. Upgrading and redevelopment is important to build a society in each housing estate with different mixture in group of population in term of education, income level and age group of people. The demand of housing is also increased indirectly. In order to balance population and housing, top priority is to strategize on factors that affect supply and demand for housing. In order to cater sufficient housing for elderly and solve the ageing problem in Singapore therefore, Government may consider taking up ideas from other countries such as Hong Kong and Japan which has currently implemented some forms of private retirement housings. Based on the Urban Redevelopment Authority (URA) survey carried out in 2002 has shown that the idea of living in retirement housing/ villages was acceptable by the society. More than 20% of elderly households are acceptable to the aforesaid concept (Committee on Ageing Issues 2006). According to Mah Bow Tan (2010), there are essentially three ways to allocate a scarce resource like housing: by price (that is, highest bidder gets it), by queue (that is, first-come, first-served), or by ballot (that is, draw lots). Allocating by price is basically the way resale flats are bought and sold in the free market. For new flats, HDB has adopted either a queue system or ballot system. In 2002, HDB switched to the BTO system to respond better to demand that was becoming more sentiment-driven. Under this system, buyers ballot for the chance to select a flat. Certain groups, such as first-timers and those applying to live near their parents, are given extra tickets in the ballot to increase their chances of getting a flat. 95% of the flat supply is set aside for first-timers. Buyers have to pay a down payment to secure a booking. Each booking represents a committed buyer. HDB proceeds to build when the majority of flats are booked. Flats are ready for occupation within three years of booking. With better matching of supply and demand, the BTO system prevents a major supply overhang. It also allows HDB to retain a small rolling buffer of a few thousand balance flats, which minimises holding costs to taxpayers. When demand is high, as it is now, the number of BTO projects is stepped up. However, there are pros and cons of BTO & RFS despite these systems is better alternative to balance supply and demand. (Refer to Appendix “A”) As supply shortage of housing is not only due to HDB hesitate to build new flat but also due to migration policy which allows to increase Permanent Resident population and cause increasing demand for housing, government has restricted on the approval of PR status so as to mitigate the increasing demand while building more public housing and allowing the lands for private housing. Singapore is now actively promoting economic policies which can lower its production costs. The rapid rise is not in the government’s interest. Foreign investors in Singapore’s housing markets share a clear cultural similarity. They are mainly Chinese in neighbouring countries. The political stability attracts them to seek safe heaven in Singapore. But the anti-speculation This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order policies defer them to be active in the housing markets. The CPF funding has a positive correlation with the housing prices in Singapore. The mortgage rate has relatively stable in Singapore. Therefore we can safely say that mortgage rate may not affect the housing prices very much in Singapore. The change of housing prices may reflect the impact of the external economic conditions such as the oil crisis and financial crisis. It indicates the vulnerability of small economies. The relationship between housing prices and domestic economic development is less conclusive. However, we find that the external economic conditions have much impact on housing markets. Singapore is more vulnerable to the impacts of the external economic development. The influx of foreign population in Singapore does not reflect a positive impact on the housing prices. Now the immigrant growth rate is double that of natural growth rate in Singapore. This can be explained that external population in Singapore do not have strong incentives of buying (United Nations Human Settlements Programme 2011). The format of the literature review is structured according to Introduction; Housing Supply in Singapore, Demand of Housing and Summary, as the research project basically examines the issues from a qualitative perspective, the focus of this literature review is on qualitative studies rather than quantitative works. The main issues and research area of housing supply and demand in Singapore 2020 have been discussed in the previous chapters. The factors which cause the unbalanced housing supply and demand also have been described in details. This chapter will describe the methodology of the research by discussing the research techniques, formulation of the data collection instrument and how the primary data will be analysed. As described in the previous chapter, this research will be carried out by mixed methods research, employing the combination of quantitative and qualitative approaches. Less well known than both the quantitative and qualitative strategies are those that involve collecting and analyzing both forms of data n a single study. The concept of mixing different methods probably originated in 1959, when Campbell and Fiske used multiple methods to study validity of psychological traits. They encouraged other to employ their “multi method matrix” to examine multiple approaches to data collection in a study. This prompted others to mix methods, and soon approaches associated with field methods such as observations and interviews (qualitative data) were combined with traditional surveys (quantitative data) (S.D. Sieber, 1973). Recognizing that all methods have limitations, researchers felt that biases inherent in any single method could neutralize or cancel the biases of other methods. Triangulating data sources-a means for seeking convergence a cross qualitative and quantitative methods – were born. From the original concept of triangulation emerged additional reasons for mixing different types of data. For example, the results from one method can help develop or inform the other method (Green, Caracelli, and Graham, 1989). Alternatively, one method can be nested within another method to provide insight into different levels or units of analysis. A mixed methods approach is one in which the researcher tends to base knowledge claims on pragmatic grounds (e.g., consequence-oriented, problem-centered, and pluralistic). It employs strategies of inquiry that involve collecting data either simultaneously or sequentially to best understand research problem. The data collection also involves gathering both numeric information (e.g., on instruments) as well as text information (e.g., on interviews) so that the final database represents both quantitative and qualitative information. The researcher bases the inquiry on the assumption that collecting diverse types of data best provides on understanding of a research problem. The study begins with a broad survey in order to generalize results to a population and then focuses, in a second phase, on detailed qualitative, open-ended interviews to collect detailed views from participants. The research method used is the “Mixed-Method Research” to tackle complex issues that reside at multiple levels. It can enhance the type of information gathered and can serve to increase the validity of both qualitative and quantitative research. (Anthi Katsirikou & Christos H. Skiadas, 2010) The research process is to produce new knowledge or deepen understanding of a topic or issue. This process takes three main forms Exploratory research, which helps identify and define a problem or question. This essay is an example of a student’s work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. Essay Writing Service Dissertation Writing Service Who wrote this essay Place an Order Constructive research, which tests theories and proposes solutions to a problem or question. Empirical research, which tests the feasibility of a solution using empirical evidence. For qualitative research is often used as a method of exploratory research as a basis for later quantitative research hypotheses. For quantitative research which is systematic empirical investigation of quantitative properties and phenomena and their relationships. A research strategy is a procedure for achieving a particular intermediary research objective such as sampling, data collection, or data analysis. The advantages of Mixed Method are its strengths and weaknesses that are able to be assessed and show different perspectives on the topic. Good research depends on good data. Research is “Systematic investigation aimed at increasing the sum of human knowledge and understanding.” (Cited: Aguillermo Aranda- Mena, 2011: OED). It is important to define the problem and set research objectives for the research plan to guide the entire research process (Kotler, Armstrong, 2011). 1 Define the problem 2 Set research objectives 3 Identify the specific causes for information needed to obtain the preliminary information required 4 Implementation of research plan 5 Analysis of data method This research plan is large and complex, needs following input of specific information: the demographic, economic, and lifestyle (ibid). In order to uncover the problems addressed, the research objectives, evaluate the quality of the information to be obtained for implementation and data analysis method are updated, accurate, relevant and unbiased. The selected survey research method is its flexibility and sensitivity to match the needs of the research question. The designed questions aim to achieve specific data collection through inquiry about relevant expertise, opinions, expectation, anticipation and trust from a broad population base of appropriate professionals to prospective home buyers. The disadvantages are the selected interviewers may need more time to reflect to arrive at desired information inquired; thus, without putting in much effort and time, the answers may not be valid. Others may feel their expertise is being challenged if they gave the wrong information or they may not be willing to share their knowledge and felt an intrusion of privacy. This questionnaire aims at a discreet selection of participants to achieve the desired outcome of this research plan. Due to the nature of this research plan, being time constraint, this sample questionnaire survey is targeted to be completed by equal numbers of 50 Architects, Engineers, Developers, HDB Officers, Housing Agents and Others, for example , the public/ common people. The range of expected pools of equal mix of respondents/ participants is to ensure an expected outcome as per the questions designed. The closed-ended questions in this research plan are designed to aid in primary data collection. The goal of this questionnaire is to discover the experts’ opinions; participants’ demand and response and future plan; forecasted future population and trust for the supply and demand of housing by 2020 as following page : Data analysis involved in analysing the data collected from the respondents. The first step is the data preparations which involves data checking and key-in the data into the system. The data preparation must be proper plan on how the data to be logged, entered, transformed if necessary and organised it into a database. It is essential in order to facilitate accuracy and efficient statistical analysis. The next step is data analysis which consists of two parts which are descriptive statistics and inferential statistics. Descriptive analysis is a process to describe the data and examine relationship between variables. It is a simple analysis which summaries the basis information for the data collected such as mean, standard deviations and range of scores for the independent and dependent variables in the study. Inferential statistics is a process to examine causal relationship. It helps to describe the conclusion beyond the immediate samples and data. Inferential statistics is not useful in describing the general conclusion on the basis identified finding but it also helps to precise the probability of error to be met as well. The last step is interpreting of the results which presents the results in the tabulation and interprets it from the statistical test. It means to draw a conclusion from the results analysed. The research design on techniques, justifying methods, primary data collection instrument design, data analysis method is approached by employing the combinations of quantitative and qualitative methods. With the limitations to all methods, the collection of data under this mixed methods have the advantages to assess and provide various perspectives on the research topic/ problem being well addressed. Good research depends on good data. Thus, detailed analysis of findings could be arrived at for reporting. However, this proposed research plan can yet be proven worthwhile to proceed unless the design is being put to a test. As population growth continues and increases the demand for housing in the city of Singapore, there is a need to find the way to balance the supply and demand by government in order to provide affordable public housing to approximately 85% of the population. This research is focused on the basic issues which influence the supply and demand of housing.