IS428 2016-17 Term1 Assign1 Jonathan Eduard Chua Lim

Abstract

Private property in Singapore is less regulated than public housing.. As such, the private property market has less barriers for Singaporeans and foreigners who wish to purchase private property, assuming that they have the financial means to do so. With many Singaporeans choosing to buy private properties for “investment” as opposed to “necessity”, is it justifiable for private properties in Singapore to be priced at their current prices, with respect to the supply of private property? Should the government let market forces take its course, or intervene in order to prevent a housing bubble, that may result in the sudden depreciation of property value when the bubble “bursts”?

Problem and Motivation

Housing purchase in Singapore is seen as one of the most important decisions that any Singaporean will make in their lifetime. A shelter on top of one’s head is one of the fundamental human needs that humans have, alongside water and food for sustenance. As a result, purchasing a house becomes a major decision that requires the consideration of many factors . At times, having a house that is ready for occupancy can be a turning point for the couple who is about to start a family, or a family with children who are moving from one neighbourhood to another.

One of the key aspects that people think about is the price of the house they are about to purchase. In Singapore, the housing price is important because the couple or family will determine their preferred price based on their salary or CPF savings, among other factors. Personally, this is very relevant as my family recently bought a house in the past 2 years, and one of the most important factors we needed to consider was the price of the house we were going to buy, and whether it was “affordable” – i.e. if our current income levels could support this important decision.

Alternatively, Singaporeans also make housing purchases as a form of investment, especially since it is able to generate passive income monthly from the rental fee that a tenant pays the landlord. As a form of investment, potential house buyers will need to ask themselves if a particular house, in a certain locality and price, is worth the investment? Will this particular unit have a strong demand from potential tenants? These questions are important as it will determine the rental fee that a landlord charges a tenant, and how quickly the landlord can obtain his/her investment money back.

Linking my thought process to the task at hand, I wanted to find out the current stock (or supply) of private property by the different categories, and find out how much are we paying for these houses at the different planning regions in Singapore. I would like to find out ifSingaporeans are paying adequately for the private property housing in a particular locality, and for their chosen category of private housing.

Approaches

I obtained the private property data from the Urban Redevelopment Authority (URA) REALIS database, which contains property information and transaction prices for Residential, Commercial and Industrial. For the purpose of this study, the focus will be on residential, in particular private property residential information.

Main Variables: I will test these variables to get insights to the questions at hand:
1. Private Property Stock – as defined from REALIS Data Dictionary, stock is interpreted as “Completed units or space, whether occupied or unoccupied, that is available for physical occupation”
2. Private Property Types – The private property types that I will be looking at are: Apartment, Condominium, Semi-Detached, Detached and Terrace housing.
3. Median Price – I have obtained the median price from the REALIS website, for the respective private property types, and based on their respective planning regions
4. Planning Regions – These are the main regions in Singapore. These regions are: Central, East, North, North East and West.

Key Assumptions

When I was gathering the data from the REALIS database, I made a few assumptions:

1. The data does not include units that has undergone “Enbloc” (or units of houses that have been sold to a single owner)
2. This does not include Executive Condominium (EC). My thought process is that ECs are still managed by the Housing and Development Board (HDB) and thus do not function fully as a private property.
3. The time frame stated for the data gathering is the 4 Quarters of the year 2015, as per the question requirements.

Tool Utitised

For this project, I made use of these tools to create my Data Visualisation Data Cleaning - Microsoft Excel

I used Microsoft Excel to convert the file downloaded from REALIS database (.csv file type) and convert it to (.xlsx file type) so that the data can be cleaned properly.

Data Visualisation - Tableau

Once the Dataset was uploaded to Tableau, I used the functions in Tableau to generate my visualisation and assist me in answering the questions provided for this assignment.