Housing and Median Income
Just read in the newspaper today that the median income in Singapore is S$2500, which means that even for a couple with median income, household income is S$5000. With an income of S$2500, the CPF contribution is S$863, with $575.38 going into the ordinary account. As such, assuming an average 4% home loan rate for a 30 year loan, and that the couple puts all their ordinary account contributions to pay for their loan, they can only afford a S$240k loan. This gives them little room to manoeuvre financially, for the repayments for the flat will start eating into their take-home amount once the interest rate climbs above 4%. Hopefully, their incomes would have risen to help cover it.
Looking at today's housing market, S$300k could buy you a 3-room HDB flat in a nice location (not prime), or a probably a 4-room unit in an out-of-the-way location. This is the plight of the median. We are not even looking at those on the lower-tail yet. So who says our housing is affordable?
Looking at today's housing market, S$300k could buy you a 3-room HDB flat in a nice location (not prime), or a probably a 4-room unit in an out-of-the-way location. This is the plight of the median. We are not even looking at those on the lower-tail yet. So who says our housing is affordable?