Lifetime Income and Housing Affordability in Singapore
Most commonly used measures of housing affordability are essentially short-run indicators that compare current income with house prices or housing costs. Despite the emphasis in the literature on the importance of long-term affordability, researchers have not developed measures of lifetime income because of data constraints. Many developed countries publish annually household income by age of household heads. Using these data for Singapore, the paper presents a methodology to compute lifetime income from predicted annual household earnings over the working life for each birth cohort in the dataset. The lifetime income of Singapore households by three income quantiles sheds new light on widening income gaps. The affordability index, defined as the ratio of lifetime income to house price, reveals informative trends and cycles in housing affordability in both the public and the private sectors. The paper argues that residential property price escalations need to be avoided.
Volume (Year): 48 (2011)
Issue (Month): 9 (July)
|Contact details of provider:|| Web page: http://www.gla.ac.uk/departments/urbanstudiesjournal|
When requesting a correction, please mention this item's handle: RePEc:sae:urbstu:v:48:y:2011:i:9:p:1875-1891. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (SAGE Publishing)
If references are entirely missing, you can add them using this form.