Singapore: Where your home loses value & everyone's better off
Singapore solved private property by making it worthless over time.
This is part of “Let Cities Build Utopia,” an 11-part series on the future of cities. Collect the complete series as a print pamphlet, digital pamphlet, or audiobook. 👇🏻
Unlike any other city on earth, Singapore is also a country, which gives it full authority over land, master planning, and taxation.
The government even owns 90% of the country’s land, which means every person and business leases property from the state through 30, 60, and 99-year leases. More than 80% of the city lives in social housing.
For the first time, we can see Ebenezer Howard’s Garden City at scale, and wow. It works!
Singapore was a British Colony before it became a Japanese stronghold during World War II. When external forces withdrew, the island tried to join Malaysia but was expelled for fighting for racial equality and shared economic prosperity. Suddenly independent in 1965, with no natural resources, massive unemployment, and a severe housing shortage that quickly dissolved into slums and squatter settlements, Prime Minister Lee Kuan Yew passed the Land Acquisition Act, which gave the state full authority to appropriate private land at a discount.
The city began claiming land and using its Housing Development Board to build residential buildings on it. As each new building went up, units were sold as a 99-year lease. By then, citizens already had access to the British-installed Central Provident Fund (or CPF), a mandatory savings account that could only be used for housing, healthcare, and eventually retirement. Now they could use it to buy new leases. Just as we might take out a mortgage to buy a home, Singaporeans could take out a mortgage to buy a lease, and even use their CPF account for the down payment!
This created Howard’s housing scheme at scale, and one of the most unique land and building rent models around the world. If an individual purchases a condo with a 99-year lease and decides to sell it 20 years later, they’re selling a 79-year lease to the next person. They might still earn a small profit on the sale if the location has become more desirable, but by the time there are fewer than 49 years on the lease, the property declines in value. By the time there is one year left on the lease, it’s worth nothing.
When the lease ends, the unit and building revert to state ownership, which usually tears down the building to build another one, selling 99-year leases once again.
This system is unlike any other in the world. Housing is not an investment or a retirement plan—buying and holding real estate means holding something that ultimately goes down in value. The only reason to purchase a lease in Singapore is because residents want to live there at an affordable “set-by-the-government-not-the-market” rate. The government, meanwhile, uses that rental income to build more housing and earn more revenue.
The real money started coming in when the state began auctioning 30, 60, and 99-year land leases to corporations.
Now the state was earning money, not just from residents, but from commercial developers building skyscrapers. Here, the government puts a property up for auction with specifications for how it can be used. Interested companies bid for the land with a plan for what they want to do with it, and the winning bid pays a large amount of the lease upfront and gets the go-ahead to build.
Oh, and the buildings are beautiful.
In the case of residential housing, the government owns the land and the building, but in the case of commercial buildings, the government owns the land and the developer owns the building. The state, in these transactions, earns money for the initial 99-year lease, but also for any mid-lease changes. If the developer wants to add more floors or change the use of the building from what was originally proposed in the lease agreement, the government calculates how much the land value is increased by this lift and charges a “development fee” for the difference. As land goes up in value, the government earns more money from the lease.
Recently, the state has opened up for private development of housing, which has led many to believe the government is privatizing. That is not the case. Private residential complexes follow commercial rules: The state still owns the land, the developer builds and owns the building. When private individuals purchase units in the building, they collectively own both the building and the land lease. When the land lease nears its end, owners can collectively decide to sell the building (and their remaining land lease) to a developer. If they do, the developer would likely demolish the building, pay the state for a new 99-year lease, and then build and sell new units. If they don’t, the land and the building will become government property at the end of the lease. Either way, residents move to another building.
That all leases end and the land and buildings revert back to government ownership is vital. In the 1990s, a population boom meant the city needed more high-rise buildings, so Singapore pulled down a bunch of low-rise buildings and built more high-density ones instead. The city wouldn’t have been able to do this if property were privately owned. Private owners would have held onto their condos, even in aging buildings, and units would have become exorbitantly expensive as more people crammed into small buildings. Instead, the city is constantly under construction, pulling down old buildings that have come back into state ownership, and building new ones that can meet growth as it happens.
The State’s Urban Redevelopment Authority uses population growth and economic development data to create a 40- to 50-year master-plan for the city, complete with how much land needs to be developed for mass transportation, commercial and residential development, and environmental resource preservation. They plan every inch of the city, knowing when every lease ends, and coming up with plans for each block and parcel decades in advance. Reading their plans for 2026, I was struck by how the government has come up with a plan to address the need for new and more affordable housing, deciding to devote more land to building higher-density buildings. No other city can master-plan based on need this way.
Planning extends beyond property development to the economy itself. The city invests land rent earnings in a series of sovereign wealth funds. Temasek Holdings—part of the country’s investment portfolio—owns equity in nearly every company in the country, and at least 20% equity in the large companies that make up 41% of Singapore’s investment portfolio. That includes the country’s mass transit organization, airports, ports, and utility companies. To diversify, Singapore also invests 36% of its portfolio in markets worldwide, and the other 23% in asset management companies, private equity funds, and other investment opportunities.
Because the country earns so much money from rents and investments, taxes are among the lowest in the world. Singapore earns only 13.8% of its GDP in tax revenue, while the OECD index of high-income countries reports tax revenue as 34% of GDP on average. Singapore’s top personal income tax is only 24% compared to an average 42% in OECD countries, and corporate taxes are a flat 17% compared to 23% in OECD countries.1
Singapore, meanwhile, uses its earnings to provide many of the social services European countries are renowned for, and which Howard once hoped the city would provide: Healthcare is universal, catastrophic insurance is provided, and routine costs are subsidized. Schools are public and heavily subsidized through college. Childcare is subsidized, and employees and employers fund pensions through the CPF, ensuring the current generation isn’t paying for current retirees but rather into their own individual savings account.
The state also provides one social service no other nation in the world provides: Affordable housing for nearly all of its residents.
Imagine getting many of the benefits of Finland, but with affordable housing too, and at half the tax burden. People and companies around the world would line up for that.
Many do.
The country earns the highest scores on nearly every metric used to rank and measure countries—income per capita, GDP per capita, government effectiveness, health outcomes, livability, ease of doing business. It also has low rates of government corruption, poverty, crime, and unemployment.
Singaporeans enjoy a higher quality of life than in most cities around the world!
This is part eight of an essay series titled “Let Cities Build Utopia.”
« Click to read the previous installment // Click to read the next installment »
Special thanks to the Center for Land Economics who supported this series as a patron. I highly recommend their newsletter “Progress & Poverty,” which was invaluable to my research.
For a full breakdown on Singapore’s earnings: As of 2025, taxes made up $103.8 billion in revenue with fees making up another $9.2 billion. Land leases earned $19.8 billion with another $1.8 billion coming from rental income. Sovereign wealth funds generated another $24.1 billion in returns. With total receipts at $145.8 billion, taxes make up only 71.1% of total income.