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In the search for creative solutions to the sinking home ownership rates amongst young Australians, one economist has turned to Singapore for the answer.

Specifically, Cameron Murray has proposed that Australia adopt Singapore's Housing Development Board (HDB) model.

According to ABC News, who interviewed Murray, only about 45 per cent of Australians between the ages of 25 to 34 own a home.

Murray compared this figure to home ownership rates across all ages in Singapore which, as of 2021, sits at just under 88 per cent.

"There’s a good chance that’s because Singapore is doing something right," wrote Murray in a piece published by The Conversation.

HouseMate

In summary, Murray's proposed scheme, which he calls HouseMate, entails buyers getting free land from government agencies and paying for the construction of their home.

Buyers would also be able to get a loan from the government at a low-interest rate — the cash rate plus one per cent.

Just like when buying a HDB flat, there are conditions to ownership.

For example, the scheme would only be open to Australian citizens aged over 24 for couples and 28 for singles where no household member currently owns property.

HouseMate buyers would also be required to occupy the home, with limits on leasing and resale for seven years.

High housing prices

In Murray's vision, it all adds up to make buying that first home affordable and achievable for young Australians, especially in comparison to the current housing market where prices are skyrocketing.

According to the Sydney Morning Herald, the median house price in Australia is now above A$1 million (S$957,000).

The record high was achieved after prices rose by almost A$215,000 (S$206,000) over 2021.

Difficulties implementing Murray's plan

However, experts speaking to ABC News noted some important differences between Australia and Singapore that might make it difficult to implement Murray's HouseMate proposal.

One is the amount of land that Australia's government owns, which is substantially less than how much land in Singapore is owned by the government.

Another issue that might arise is that the land available for such a project could be in an undesirable location, far away from the city.

Yet, Murray told ABC News that he was unconcerned.

"I am putting it out there to start the conversation," he said.

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Top image by Tom Rumble and Modern Affliction via Unsplash