Have ASEAN House Prices Kept Up With Incomes?

The short answer is: yes. Throughout the ASEAN region, incomes have risen together with house prices. The only exception is Thailand, where house prices have underperformed both incomes as well as inflation. As of 2015, the Thailand House Price Index is only 15.13% higher than where it was as of year-end 2004. Incomes, as measured by GDP Per Capita, are 120% higher than they were during the same period. General prices are 33.84% higher than they were for the same period.

In all the other countries, incomes have outpaced house prices as well as inflation. However, in certain countries, the gap between incomes and house prices is narrowing. In Malaysia, incomes fell in 2015 to such an extent that only a 16.38% gap exists between incomes and house prices. The GDP per capita index now stands at 243.88 while house price index is at 227.50 as of 2015.

In Singapore, that gap between incomes and house prices is now only 20.66 percentage points.

In Indonesia, the gap between incomes and inflation has narrowed considerably. It is only 10.02% percentage points. But the gap between incomes and house prices remains stubbornly wide: 37.95% percentage points.

In the Philippines, incomes have outpaced house prices by a large margin 47.89% percentage points as of 2015.  The gap between incomes and inflation is even larger: 107.96% percentage points.

This indicates that ASEAN house prices, in general, may have more room to run if incomes continue to grow and that growth is evenly distributed. As in most emerging economies, income and wealth inequality is rampant, especially in the Philippines. Read: One Major Reason for the Rise of the Vulgarian Rodrigo Duterte: Wealth Inequality