Subsidies, grants for public housing may be fuelling higher home prices

DESPITE some homes in Singapore fetching astronomical prices, the home-ownership rate among residents is high.

A key factor behind high home ownership is the availability of affordably priced new Housing and Development Board or HDB homes, thanks to generous subsidies.

For example, a new Build-To-Order (BTO) four-room 99-year leasehold HDB flat might be priced at 30 to 40 per cent below older comparable resale flats nearby with shorter land lease outstanding. Furthermore, many BTO flat buyers receive housing grants.