The city-state of Singapore requires citizens to pay for a “certificate of entitlement” (COE) before purchasing an automobile. The cost of a ten-year COE was raised on Wednesday to $106,376, marking a 400 percent increase over the past two years. Singapore is the most expensive place in the world to own a car, by a considerable margin.
The median household salary in Singapore is about $88,000 per year. With the cost of the COE included, a modest Toyota Camry Hybrid that lists for $28,855 in the United States will set a Singaporean back about $183,000. A small apartment would cost less than $100,000.
Being able to afford a COE is no guarantee of getting one, as they are awarded through a bidding process that occurs once every two weeks, with only a limited number of certificates for sale. The $106,000 certificate covers only small automobiles – larger cars and commercial vehicles require even more expensive documents.
More certificates are made available when older cars are taken off the road. Singapore has a population of about 5.5 million, but less than one million private automobiles.
The COE program was inaugurated in 1990 to reduce the number of vehicles on the roads of the small island country, which “can be driven across in less than an hour.” The government urges residents to use public transportation instead of driving.
Singapore has a relatively high concentration of millionaires, so those pricey COEs tend to get snapped up quickly.
“Whenever we have luxury cars, buyers are queuing up outside our store,” a local Toyota dealer told the BBC, speculating that heavy demand for new vehicles prompted the government to raise the COE price even higher.
On the other hand, Sky News reported many Singaporeans are “selling the cars they bought when COE prices were low to make a profit.”