Is a “property boom” caused by an influx of immigrants sustainable?

By: Leong Sze Hian

I refer to the article “Investing in commercial real estate in Singapore” (Yahoo Finance, Dec 30, 2016).

Property boom from 2008 to 2013

It states that “Many Singaporeans rode the property boom in the years from 2008 to 2013 to build a substantial level of wealth for themselves. But the last three years have been unkind to Singapore’s property market.”

Prices increased by 62%?

The URA Private Residential Property Price Index increased by about 62 per cent from 95.3 (2009 Q2) to 154.6 (2013 Q3).

Incomes increased by only 28%?

In contrast,  the Median Gross Monthly Income From Work (Including Employer CPF Contributions) of Full-Time Employed Residents – increased by only about 28 per cent, from $2,897 in 2008 to $3,705 in 2013.

And we have not even adjusted for the median gross monthly income of all Singaporean (excluding PRs) workers (full-time and part-time) excluding employer CPF contribution!

0.5m increase in foreigners vs 0.1m increase in S’poreans?

Arguably, this was fueled by the huge increase in the non-Singaporean population from about 1.6 million in 2008 to about 2.1 million in 2013 (0.5 million increase), against the about 3.2 to 3.3 million increase for citizens (100,000 increase).

And we have not even adjusted for new citizens granted during that period!


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