A STUDY OF THE PUBLIC RENTAL SCHEME IN SINGAPORE AND ITS RELATIONSHIP TO WEALTH INEQUALITY

Abstract

Growing inequality in Singapore is a distortion to Singapore’s key principle of meritocracy. A large majority of Singaporeans own their homes and enjoy some form of asset appreciation from it. However, for the small minority of low-income Singaporean households who are financially unable to afford a home, they have no choice but to turn to the rental market to fulfil their housing needs.

Public rental housing in Singapore is heavily stigmatised due to the government’s long-standing bias towards homeownership and its anti-welfare policies. Together with a survey, case studies were done on households currently living in a public rental flat in Singapore to better understand some of the problems that these households were facing. The data collected was used to determine several factors which were preventing renters from achieving homeownership and to assess the implications of residency in a public rental flat with regards to wealth inequality.

It was found that the Housing Development Board’s Public Rental Scheme may actually be a hindrance for low income households to achieve homeownership. This was because many renters found homeownership to be financially unrealistic, with the next best alternative of renting on the private market undesirable when compared to renting a HDB flat from the HDB at a heavily subsidized rate. Further recommendations were then made on how rental housing could be normalized in Singapore to help prevent further perpetuation of wealth inequality in Singapore.