A Tale of Two Cities the Effectiveness of Macroprudential and Regulatory Policies in the Housing Markets - Singapore Versus Hong Kong Sar

Focusing on the property markets in two global cities, Singapore and Hong Kong SAR (Hong Kong), this paper presents stylized facts about their respective housing markets and examines their experiences with macroprudential policies and related regulatory policies such as stamp duties. Panel regression results with regional variations for these two economies reveal that loan-to-value limits and additional buyer's stamp duty can help insulate domestic property prices from global prices in Singapore but cannot directly help dampen house price growth. While loan-to-value limits and stamp duty do not have any effect on decoupling house price synchronicity in Hong Kong, these policies help contain domestic house price growth. Empirical evidence also suggests that land supply seems effective in stabilizing house price growth in Singapore but they tend to accentuate the property cycle in Hong Kong