RESIDENTIAL RECENTRALIZATION IN SINGAPORE: IMPLICATIONS FOR THE PROPERTY MARKET

Abstract

Over the past four decades, Singapore has experienced a marked transformation in its urban landscape, in particular, the redevelopment of the Central Area from an urban slum to the metropolitan commercial hub that we see today. However, the early emphasis in the development of the Central Business District had neglected the importance of creating a balanced commercial cum residential setting until the re-introduction of inner-city living in the revised 2001 Concept Plan. Since then, a few scattered inner-city residential projects had been proposed in the forms of new builds and office conversions which received overwhelming response from the public. To investigate the sustainability of the current residential recentralization interest, this paper uses the transaction data of downtown homes as a proxy for the level of speculation in the inner-city residential sub-market. The analysis illustrates that there had been a fairly strong amount of speculation in the demand for housing in the inner-city, signifying that current interests towards residential recentralization may not yield a long-term trend towards inner-city living. On its implications on the property market, the continuing strong performance by the inner-city homes may narrow the prices of quality homes in the traditional prime areas and city-center. Also, the luxury-sector led recovery in the property market seems to have filter down the residential pyramid to the mass-market. The challenge for the planners comes in the form of managing the housing aspirations of the population and realizing the planning objective of 90,000 new homes in the inner-city.