Average price of an HDB flat is still under three times the median household income.
Homes in Singapore were rated as seriously unaffordable, according to Demographia International in its14th Annual Demographia International Housing Affordability Survey.
Singapore got a median multiple of 4.8 in 2017, indicating a seriously unaffordable rating.
The median multiple is a measurement of housing affordability by linking median house prices to median household incomes.
According to Demographia, this is an improvement from Singapore's rating in 2013 which recorded a median multiple of 5.1, indicative of a severely unaffordable housing market.
Meanwhile, the US got a 3.8 rating as having the most affordable homes, followed by Japan with 4.2, and Canada with 4.3.
There are 26 severely affordable major housing markets in 2017 with Hong Kong ranking as the least affordable with a rating of 19.4 up from 18.1 last year, followed by Sydney with 12.9, and Vancouver with 12.6.
The study said one of the Singapore government's strategies in curbing the housing market price increase is to add "across the board" subsidies for all new houses. This has effectively pushed prices down to levels well below those of existing houses.
Whilst not accounted for in terms of affordability, the authors mentioned the price-reducing grants that are made available to resale house buyers.
Study author Paul Cheshire said, "The practice in Singapore may be substantially greater than in other nations, which would seem to have a positive influence on housing affordability."
As at November 2017, Singapore's after-grant prices range from $175,000 to $305,000 for the most popular floor plan. The midpoint of the pricing would be under three times the median household income.
The study also noted that Singapore's flats are larger by 44 sqft than those in Hong Kong and by 84 sqm than new houses in the UK. However, the flats are still 219 sqm smaller than new houses in the US.
Demographia said that Singapore has no mainland periphery within its national jurisdiction and, as a result, does not have the luxury of a potentially competitive market for housing land that would keep housing affordable.
Its publicly sponsored housing construction program resulted in a "vibrant competitive" housing market with about 82% of residents live in HDB housing. Further, Singapore has an overall 88% rate of home ownership, the highest of any country in the survey.
Buyers are also free to sell their own houses as in other nations with private ownership. Further, there are restrictions on foreign ownership, "which may have shielded Singapore from the heightened cost escalation occurring from the globalization of the real estate markets," Cheshire said.
"The contrast is great between the present situation and that of 50 years ago when there were large squatter settlements," he added.
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