2023 Summer Issue of Urban Land - 61

Cindy Xu, Dylan Gray, Dionne Hoh, Blake Olafson, Ken Rhee
High Housing Costs and Shifting Attitudes Make
Build-to-Rent More Viable in Asia Pacific
AT A uli Asia Pacific Young Leaders
Group Forum on housing attainability in
May, three young panelists focused on
the challenges and changes in housing
in Australia, China, and Singapore.
Taking part were Cindy Xu of Partners
Group, from Shenzhen, China;
Dylan Gray of Urbis, from Australia;
and Dionne Hoh of Boston Consulting
Group, a Singapore native. Blake
Olafson, founder of multifamily housing
developer ACRE and chair of the ULI
Asia Pacific Housing Council, moderated
the discussion.
Asked about the importance of
homeownership for the young generation,
Xu said, " For Chinese individuals,
there's a cultural element in terms of
buying a house. They have to buy a
house before they even start a family.
However, coming down to the new
younger generation, they are more
than willing to rent. " Attitudes may
have changed because there is limited
potential for capital appreciation, she
said, and the young generation prefers
more flexibility or mobility in their living
arrangement.
In Singapore, members of the young
generation do not necessarily share their
parents' strong preference for homeownership,
Hoh said. In Australia, the
new generation of buyers has a more
flexible mind-set toward homeownership
because of economic challenges and
capital appreciation that does not match
that of previous generations, Gray said.
The panel also discussed the value of
community for younger generations in
choosing where to live. One view was
that young people are willing to live in
smaller units if they can have access to
common facilities and have opportunities
to meet other renters of similar age
and interests. Some people definitely
prefer autonomy and privacy when they
stay at home, Hoh said.
Audience member Bennett Theseira,
managing director and head of real
Blake Olafson (right), founder of ACRE and chair of the ULI Asia Pacific Housing
Council, moderates a discussion at the YLG Forum in Singapore with Cindy Xu
of Partners Group; Dylan Gray of Urbis from Australia; and Dionne Hoh of Boston
Consulting Group.
estate for Asia Pacific at PGIM Real
Estate and chair of ULI Singapore, was
asked about co-living assets as an
investment class. He said the co-living
concept is promising but still relatively
new and needs to be proven out.
Because co-living leases tend to be
shorter than traditional rents, the revenue
stream of co-living assets can be
less stable, he pointed out.
Also discussed was built-to-rent (BTR)
housing, or multifamily units for rent, primarily
owned by institutional investors.
In the United States and Japan, multifamily
rental homes constitute the largest
real estate investment class, Olafson
noted, whereas in the Asia Pacific region
excluding Japan, there is a very limited
pool of multifamily rental homes.
In mainland China, Xu said, rental
housing may gain significant popularity
if renters can send their children to
nearby public schools. Currently in mainland
China, homeownership is required
in order to send children to popular
neighborhood schools. She added that
while home prices are quite high in
Shenzhen, a large pool of " informal "
housing exists in urban villages, which
provides relatively inexpensive housing
either for purchase or rent. Though
these informal homes lack proper
property titles, prices and rents are significantly
lower than homes that have
proper property titles.
In Australia, most rental assets are
individually owned apartment units and
single-family homes, Gray said. " BTR is
popular but somewhat difficult to implement
due to cultural aspects. It's only
one piece of the puzzle, " he said. To
improve home attainability, there should
be more emphasis on increasing housing
supply, he said.
It is the low-income segment of society
that is most house challenged, with
limited housing options, so more affordable
housing supply needs to be added
to the market to meet the need, Olafson
said. He added that construction costs
need to be reduced to make housing
more affordable. He suggested that
manufactured homes can reduce costs,
and that more flexible debt financing
options would help the BTR sector grow
in the region.
The event opened with a short presentation
on the newly released 2023
ULI Asia Pacific Home Attainability
Index by Ken Rhee, the report's primary
author. He provided key takeaways from
the report, which covers 45 cities in nine
countries in the region, including four
newly added countries: India, Indonesia,
the Philippines, and Vietnam. (The report
is available on Knowledge Finder.) UL
KEN RHEE is chief executive officer of Integral VIM and ULI
China senior director.
SUMMER 2023
URBAN LAND
61
ULI MEETING COVERAGE
ULI
2023 Summer Issue of Urban Land

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