Singapore's housing system: What can New Zealand learn?

Housing systems are complex and have many moving parts, from zoning regulations and construction processes through to household finance. But at a more fundamental level, housing systems are shaped by a set of underlying background ideas that provide the logic for how the system operates. Housing scholars use the term 'housing regime' to describe such underlying principles that provide the ideational blueprint or ‘software’ guiding a housing system(8). A key part of a housing regime is ideas about the appropriate role of the state versus the market in organising and allocating housing. Housing regimes also contain ideas as to what ‘good’ housing looks like in a given society (the ‘New Zealand dream’ of the standalone suburban family home, for example, remains a resonant, underlying idea)(9).

Housing and Development Board apartments under 99-year leasehold in Singapore's Potong Pasir neighbourhood (Wiki Commons; Author: Aatu Dorochenko)

Housing regimes are not static. They develop and evolve over time, shaped by politics, public discourse and responses to new problems(10). Comparing New Zealand and Singapore makes this point clear. The Singaporean system is underpinned by a view that the state is uniquely and appropriately placed to manage the housing system, with market mechanisms a helpful servant but not the master. Singapore’s system has been characterised as a ‘globally unique model of public private housing’(11) that is progressive and philosophically devoted to lower-class opportunity expansion(12).

By contrast, New Zealand's housing regime from the 1990s onward is characterised by a view that the state is primarily the rule setter for private market development (for instance, planning and zoning), a limited provider of housing support (such as social housing and the Accommodation Supplement), and has no role as a housing financer of first resort for households. The structure of Singapore’s housing system, and its political context and history, is examined below.

Singapore is an island city-state of approximately 5.9 million people at the southern tip of the Malay Peninsula, ten hours flying distance from Auckland. Its economic transformation from a small post-colonial trading post at the dawn of independence in 1965 to a key node in the global economy is well known. Less often appreciated is how central housing has been to the republic’s political project and to the ongoing legitimacy of the state.

Established in 1960, the Housing and Development Board (HDB) is Singapore’s primary housing agency. HDB has supplied over one million flats since establishment, with approximately 80 percent of Singaporean residents living in HDB housing(14). The state owns 90 percent of Singapore’s land. HDB houses are sold on a 99-year leasehold basis under which the state retains the underlying land but confers on residents the same legal rights as private homeowners(15). New flats sold by HDB are priced with significant market discounts, and eligible first home buyers also receive deposit support of up to SGD $120,000 depending on income and property location.

Housing and Development Board flats in Bukit Panjang, Singapore (Wkiki Commons; Author: Erwin Soo)

Homeownership support is integrated into the design of Singapore’s social security system, the Central Provident Fund (CPF). Depending on age, citizens pay between 12.5 and 37 percent of monthly salaries into their individual CPF accounts to cover health, unemployment, retirement savings, and housing costs. A portion of funds can be used to make mortgage payments directly to HDB. CPF savings are protected by law from bankruptcy proceedings, thus providing another layer of housing tenure security(16). The integration of social security and housing finance is one of the most institutionally distinctive features of the Singaporean model: its housing policy, retirement policy and labour market participation are functionally interlinked and reinforcing.

Another critical feature of Singapore’s system is that while owners may sell their flat on the secondary HDB resale market, only one HDB flat may be owned at a time. This restriction shields citizens from competing with investors and acts as a bulwark against speculation and housing financialisation trends seen in other systems(17), including New Zealand(18).

Singapore's housing system cannot be understood apart from its political history. The People's Action Party (PAP), which has governed Singapore since independence in 1965, began as a broadly social democratic party with anti-colonial roots(19). Its pre-independence election platform included a commitment to address severe housing shortages and slum conditions that the British colonial administration had largely neglected. The HDB was established in 1960 with a popular mandate to plan and roll out a major public housing programme(20).

State control of land was a critical system input. The Land Acquisition Act of 1966 gave the state powers to compulsorily acquire land, particularly idle or underutilised holdings below market value for housing development. Prime Minister Lee Kuan Yew reasoned that given land would accrue value from a programme of public infrastructure investment, private landowners sitting on unimproved land had no claim to unearned gains(21).

A supporter of the Workers’ Party of Singapore, the country’s largest opposition party, attends a rally at Bedok Stadium during the 2011 Singapore general election.

Housing remains important to the PAP’s political legitimacy. Public backlash over housing has at times translated into ballot box action. The PAP lost the 1981 Anson by-election, its first defeat since independence, when constituents evicted to make way for a redevelopment project campaigned against not being given priority in the new housing district(22). The 2011 general election marked a sharper reckoning. Rapid increases in housing prices saw the resale price index for public housing rise by 86 percent between 2005 and 2012. Against a backdrop of public dissatisfaction and increasing affordability concerns amongst citizens, the PAP’s vote share fell to 60 percent, its lowest ever, and the party lost seven parliamentary seats. The government responded swiftly by expanding the supply of new flats, revising pricing and grants, tightening rules on multiple property purchases, and introducing macro-prudential measures including household debt servicing limits(23). Housing issues in Singapore thus function as a genuine pressure mechanism on the government, yielding attention and policy responses.

Like all housing systems, Singapore’s has its share of limitations and challenges. New build flats come with a wait list, with some groups prioritised over others, reflecting the state’s view of social norms and ideal family structure. This helps explain the appeal of the secondary resale market for those who miss out or who can afford to participate. Rising prices in the secondary market also push up prices of new flats, as HDB uses a pricing formula tied to resale market prices before adding in a subsidy(24). Furthermore, 99-year leases inevitably run their course, creating a tension between expectations of a solid asset in retirement and declining property values as a lease runs out.

New builds in Singapore are highly sought after and typically have long waitlists

A variety of instruments have been put in place to help ensure flats do work as assets for older citizens, including allowing citizens to downsize to smaller flats on shorter leases as well as ‘lease buy back’ schemes where HDB purchases a portion of the remaining years of the lease. This provides the owner with an annuity product paying out over time(25). At the same time, shortened leases provide HDB an opportunity to refresh or redevelop a site and benefit from increased land values when pricing for sale. Structural population ageing may increase demand for support, placing strains on these policy choices. Lastly, while housing is widely distributed as an asset, differences in flat size, location and market values still reflect and reinforce social inequalities.

The mid-20th century both the Labour and National governments greatly expanded the building of state houses in New Zealand (Wiki Commons; Author: Archives New Zealand)

No nation’s housing system will map easily onto others. Singapore is a post-colonial city-state where a single party has governed since independence. Near-total state control of land and a highly disciplined approach to long-term planning are unique characteristics of the model. New Zealand is a liberal democracy with regular changes in government, a large land area relative to population, and a housing history shaped by a greater role for market provision.

Nevertheless, Singapore offers ideas and examples worth exploring. The first concerns the state's role as system architect. Singapore has developed a form of housing statecraft that uses state power, capacity and resources to organise housing provision. HDB does not wait for the private market to supply housing. It plans, builds, allocates, manages and renews housing, doing so broadly in the public interest with no view to making a profit. This comprehensive mandate, and the integration of housing with the social security system, is what makes the provision of affordable housing at scale possible.

Prior to 1990, the New Zealand state had an active role in building affordable housing and financing New Zealanders into homeownership through deposit support and low-cost mortgages. The First National Government (1949–1957) presided over a considerable expansion of home ownership, building on state capacity developed through Labour’s state housing programme. The Second Labour Government (1957–1960) went further, allowing households with children to capitalise their family benefit entitlement to a total of £1000 (approximately $60,000 in 2026 dollars) for a deposit.

New State Houses in Orakei Auckland in the late 1940s (Wiki Commons; Author: Archives New Zealand)

The result over the long term was a lift in homeownership from 57 percent at the end of the Second World War to a high of 74 percent by 1991. A break occurred in 1990, when the role of government in the housing system was curtailed due to a preference for market provision based on the view that market forces would deliver appropriate housing for all(26). A New Zealand that is serious about broadening ownership needs to reconsider the role of the state.

Singapore’s approach to land ownership and control cannot be transplanted directly into New Zealand. The Crown’s holdings are more modest, and land is shaped by Te Tiriti o Waitangi. Making land available for new development at scale would require a New Zealand approach grounded in negotiation, partnership and shared decision-making. However, this does not detract from the broader point: collective resources and state capacity can be used to broaden access to ownership.

State-bult Minha Casa Minha Vida (My House My Life) apartments in Sao Polo, Brazil, provide affordable homes to low and middle-income families

Several attempts to replicate Singapore’s model have been rolled out or proposed elsewhere, including Brazil’s Minha Casa Minha Vida scheme(27) and Hawaii’s proposed ‘Aloha Homes’ model(28). Closer to home, Australian economist Cameron Murray proposes a modified version of the Singaporean system whereby a new agency, ‘HouseMate’, would construct and sell homes at cost, financed with a discounted mortgage and with deposits and repayments drawn from compulsory superannuation payments(29). Murray estimates this form of housing could be delivered at under $400,000 per unit by utilising existing public land, acquiring new land cheaply, using design competitions, and leveraging private sector development capacity during downturns. For Murray, the key challenge is not institutional design, but opposition from interests invested in the status quo. He draws a parallel with opposition to the Whitlam government’s development of socialised medical insurance (Medicare). A New Zealand version may face similar resistance.

New Zealand’s history of state-led homeownership expansion and more recent, albeit problematic, experiments like KiwiBuild point to the possibility of policy innovation. Programmes like Whai Rawa, which integrate retirement savings, education funding and support for homeownership, also point to iwi Māori innovation and aspiration for social security(30). As usual, a look to Asia provides rich comparison. Singapore’s system demonstrates that other policy approaches exist and that declining homeownership rates are not inevitable.

The views and opinions expressed in this article are those of the author and do not necessarily reflect the possition of the Asia New Zealand Foundation.

About the author

Dr Jordan King is a Wellington-based researcher and policy analyst with expertise in the political economy of urban development and housing systems. He holds a PhD in Sociology from the University of Auckland and an MA in China Development Studies from the Department of Geography at the University of Hong Kong.

The Foundation's Asia in Focus initiative publishes expert insights and analysis on issues across Asia, as well as New Zealand’s evolving relationship with the region.