Home ownership policy in Singapore: An assessment

Since independence in 1965, housing conditions in the city‐state of Singapore, with a population of 2.6 million in 1988, have improved considerably. Much of the credit for this must be attributed to the government's policy of building homes for the lower income groups. One objective of the housing policy is 100 per cent home ownership for public housing. In pursuing this policy the political and social aspects are often emphasised. This paper attempts an economic evaluation of the 100 per cent home ownership target. It examines the demand and supply side policies that are employed to achieve the target. In analysing the economic implications of the policy, it is observed that such a policy distorts household expenditure, leads to overconsumption of housing and results in a thinner rental market and constrains tenure choice. These economic losses need to be recognised even while accepting the political and social importance of the policy.