Have you ever wondered how much it would cost to build a home? Or, perhaps, how it might fare against the prices of other high-rise apartments around the world?
Singapore-based mortgage advisory company, Redbrick has released an infographic which analyses how much it costs to construct an average, standard apartment.
Going on their research, Singapore is one of the more expensive cities to build in Southeast Asia. In fact, their prices (averaging USD$122.63-139.35 or AUD$153.63-174.59) are almost on par with Seoul.
But why are the prices to construct a home in Singapore (and other countries) so high? Redbrick offers the following thoughts:
Kuala Lumpur, Vietnam and Beijing are some of the emerging cities with construction prices below USD$100 per square foot. These cities keep their construction costs low via 3 factors designed to fuel economic growth, Redbrick says.
- Cookie cutting: In cities like Beijing, it’s not uncommon to see a forest of cloned high-rise residnetial buildings. These buildings tend to look as if they’ve come from the same cookie cutter. They cost very little, but lack the vibrancy of creative architecture that can be found in more developed countries like the USA.
- Quantity over quality: High rise residential buildings frequently have increasingly poor safety measures and may use substandard materials in constuction. With little to no variation in architectural design, these ‘cookie-cutter’ buildings can be constructed fast.
- Cheap labour costs: In these emerging cities, it’s not uncommon to find the labour costs a lot cheaper than other places. Since China launched its market reform in 1978, its factory and construction sectors in cities have gained about 278 million migrant workers from the rural villages.
The likes of Seoul, Singapore, USA, Macau, Hong Kong and London are cities with housing prices above USD$100 per square foot.
Not only are they classed as developed mega-cities, they’re also among the top 11 countries listed by the International Monetary Fund as having the highest gross domestic product (at purchasing power parity) per capita.
So, for these cities, their high purchasing power can be attributed to growth in population from rural-urban migration, as well as the inflow of foreign workers. But with an increase in population exceeding that of house supply, they face a real demand for housing which results in rapid depletion of available construction materials – this pushes up the cost of housing.
What’s Singapore’s situation?
Singapore’s Housing Development Board has progressively planned and developed housing to become more sustainable and modernistic with a focus on eco-friendly and design-driven attributes. These 2 key housing revamps are behind the high prices in Singapore.
- Eco-friendly: It’s no surprise, but the eco-friendly features such as centralised chutes for recyclables and eco-pedestals for future public housing drive up some cost.
- Design-driven: Today’s high rise apartments are becoming increasingly design driven. Together with an advancement in design and construction techniques, Singapore’s HDB has created more complex (but aesthetically pleasing) buildings under the Remaking our Heartland scheme.
Affordability for everyone
Although it’s by no means easy to keep the cost of constructing a house low while also retaining quality and safety, governments around the world are trying their best to keep housing affordable and available, within reach of today’s homebuyers.