Singapore's 'Certificate of Entitlement' to own car now costs over $106,000, or more than two cars

Singapore's vehicle quota system is running at an all-time high, following which, to own a car in the city-country, a buyer must bid for a certificate that now costs US$106,000 (over ₹88 lakh).

Singapore has a 10-year "certificate of entitlement" (COE) system, introduced in 1990, to control the number of vehicles in the small country.

The city-country is home to nearly 6 million people.

Singapore's expensive city status elevated by COE system

The Certificate of Entitlement is offered through a bidding process.

In 2020, when fewer people in Singapore were driving, the price of COEs dropped to about S$30,000.

A post-Covid increase in economic activity has led to more car purchases while the total number of vehicles on the road is capped at about 950,000.

The number of new COEs available also depends on how many older cars are deregistered.

What does it mean?

Experts cited in the Singaporean media say that the skyrocketing price of the COEs as well as the cars puts the four-wheelers out of the reach of most middle-class Singaporeans.

This has also depleted the ability of Singapore residents into a purported "Singapore Dream" of upward social mobility, according to sociologist Tan Ern Ser

The median annual household salary in Singapore is S$121,188.

Singaporeans have been battling a persistent inflation and a slowing economy, and some are selling the cars they bought when COE prices were low to make a profit.

"There is a need to lower one’s aspiration from achieving the 'good life' to settling with a 'good enough life'," Tan was quoted as saying by The Edge Malaysia.

Jason Guan, 40, an insurance agent and father of two, said he bought his first car, a Toyota Rush, for S$65,000 in 2008, including the price of the COE.

Also watch |Car ownership in Singapore is an expensive luxury only few can afford

Now Guan lives without a car, focusing on other perks that Singapore offers for his family.

"As a family man, it doesn’t affect me much as Singapore still has a good and stable education system. In terms of security, it's still one of the safest countries," he was quoted as saying by the Malaysia-based publication.

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