The Demographia International Housing Affordability Survey placed Hong Kong as the most expensive housing market among 406 major metropolitan regions for the seventh year in a row.

A Hong Kong home's median price is 18.1 times the median annual pretax household income last year, placing it in the "severely unaffordable" range.

Singapore median home price is 4.8 times of median annual household income last year, making it "seriously unaffordable". It was "severely unaffordable" at 5.1 in 2013.

The survey studied home prices in nine countries: Australia, Canada, China, Ireland, Japan, New Zealand, Singapore, the United Kingdom and the United States.

It found 11 affordable major housing markets, all in the United States. The rest fell into the "moderately unaffordable", "seriously unaffordable", and "severely unaffordable" bands.

Rationale for a survey of home affordability

The survey noted that every year, 'best cities' and 'most livable cities' lists are produced by various organisations. Aimed at the high end of the housing market, these surveys virtually never evaluate housing affordability. Yet, the media often mischaracterises the findings as relevant to the majority of households."

It goes on to say that "a city cannot be livable, nor can it be a best city to middle-income households that cannot afford to live there."

Singapore a notable exception?

The survey claims that despite the importance of "housing affordability to achievement and maintenance of a strong middle-class, it may be surprising that governments have not given it a higher priority".

It added that "in many housing markets, governments have implemented public policies that do the opposite -- by severely reducing housing affordability." However, it said Singapore was a notable exception, with a "half-century institutional initiative to keep housing affordable."

Half-century initiative being the Housing Development Board (HDB)

The survey described Singapore's housing market as:

Singapore has perhaps the most land constrained geography of any major metropolitan area in the world, occupying a highly developed island, with no mainland periphery within its national jurisdiction. As a result, there is virtually no potential for greenfield development and it is difficult to maintain a competitive supply of land.

In its report on Singapore, it noted that the HDB was born out of Singapore's "unique circumstances" and that HDB's increased rate of construction and supply of houses has led to better housing affordability. With affordability of new houses being better.

It added that restrictions on foreign ownership may have shielded Singapore from the heightened cost escalation occurring from globalisation of the real estate markets in an environment of significant land supply restrictions (such as urban containment policy).

It said that given its highly regulated market, Singapore "has been far more successful in controlling housing affordability than in markets that have followed the British urban containment model" and that affordability did not deteriorate to severely unaffordable levels like in other highly regulated markets such as Hong Kong, Sydney and London.

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