IS THE COST OF LIVING IN SINGAPORE REALLY HIGHER THAN IN MALAYSIA?

Malaysians at large form their fallacious perception based on four premises:

1.      The conversion rate of the Ringgit to Singapore Dollar is highly unfavourable to Malaysians who visit Singapore because of the rising appreciation of the latter currency. At the time of
writing this article, Malaysians have to pay about RM2.70 for S$1.

2.      Singapore has already attained developed nation status and also a cosmopolitan nation, thus naturally things are more expensive there.

3.      Housing in the island nation is more expensive.

4.      Cars are very expensive to own there.

Now, allow me to rebut.

In the first place, one should not make comparisons by using the currency conversion rates. Certainly, a Malaysian visitor to Singapore who calculates back every Singapore Dollar spent to the Ringgit amount will say everything in Singapore is more expensive to him.

Secondly, cost of living should rightly be adjudged by the average income of job categories versus the average prices of goods and services, especially the necessities for sustaining a decent livelihood. Simply put, it is the factor of how much a job will be paid in the currency of the country in question and how much the income earner will have to pay for the normal consumption of goods and services in that country.

I contend a wage earner of a specific vocation who earns in Singapore Dollar and spends in
Singapore Dollar may not be worse off than his Malaysian counterpart earning in Malaysian Ringgit and spending in Malaysian Ringgit. We should also view the scenario of Singapore juxtaposed to the Malaysian capital city of Kuala Lumpur (KL) together with its peripheral townships like Petaling Jaya (PJ) for compatible comparison in terms of wage levels and consumption costs. The other
city entailing similar cost of living as KL in Malaysia is Johor Bahru (JB), the capital of Johor State. JB is situated at the south end tip of peninsular (West) Malaysia, which is separated from Singapore by the very narrow Straits (channel) of Johor.

In KL, PJ or JB, the normal salary of a fresh graduate recruited as executive by a financial
institution is RM2,500. In Singapore, such position will start off at S$3,000 to S$3,500, depending on degree attainment and job scopes. Civil service jobs for fresh graduates also pay higher quantum than in Malaysia. My search through the web revealed that the average salaries in civil service start around the range of $3,100 to $3,700, again depending on degree attainment and job scopes.
Year-end bonus is payable too, if deserving based on individual performance.

I find the average prices of foodstuffs are cheaper there than in Malaysia. I had lunch in
a popular noodle shop in a mall during my recent visit. The prices range from S$3.50 to S$4.50 for different varieties. In food courts, even those sited in commercial areas, normal food prices are about S$5. Similar items served in a coffee shop outlet and hawker centres in KL or PJ now cost RM6 to RM7. Food courts operating in malls and cafes in KL and PJ list prices at least 30 per cent more than coffee shops and hawker centres.
(Look at the prices........how much will similar servings cost in RM in KL?)
(This McDonald value meal cost me S$5.95. How much will the same meal cost in M'sia?)
(Food prices are going up again in KL. It is either higher price or lesser quantity per serving.)
Apparels are also reasonably priced. For example, a consumer can get a reasonably good quality shirt in a prime shopping complex in upmarket Orchard Road for around S$50 or less. From my observation, a similar quality sold in a prime shopping complex or mall in KL may cost more in Ringgit quantum.
(Quality shirts offered for S$36.90 during the recent year-end sale in a prime shopping complex.)
Simple recreation is not expensive. A jug – equivalent to four mugs - of Tiger beer during “happy hours” in many pubs is available at S$25. In supermarkets, a large bottle is priced at around s$5.20. My web search picked up a popular outlet offering S$6 per pint (size of a large mug) within its “crazy hours” from 7 pm to 9 pm. Back home, a jug of the same beer will be charged around RM40 or more during happy hours which normally end at 8 pm; thereafter the cost will be above RM50. Incidentally, I watched a movie in Shaw House Cineplex. As a senior citizen, I paid S$4. In KL, the rate for senior citizens (offered only for afternoon runs, not for evenings) is RM8.  

“High class” lifestyles like membership in prime country clubs with golf facilities in Singapore are undeniably costly. The top two posh clubs offer membership at the cost of around S$200,000 to S$260,000 joining fee – the lower fee for locals and the other for foreigners. But many other clubs at affordable membership fees are available. For example, a golf club further away from the city centre offers membership to locals (foreigners not allowed) at joining fee of S$6,500.
A few popular sports clubs patronised by both locals and foreigners admit membership at S$20,000. Let us compare the membership fees of clubs around KL. My check on the web revealed that the non-golf membership of a popular club is available at RM20,000. Transferrable memberships of a golf and country club just out of the PJ area are for sale between RM70,000 and RM80,000. I also
noticed a sale notice of transferrable membership in the webpage of another golf and country club located in KL city being offered at RM190,000. Evidently, exclusive clubs in and around KL are as costly to join as those in Singapore.

Housing seems to be costlier there, albeit may not be in great contrast with Malaysian
residential properties.  Let us first compare rental rates. The rental for a modern three-bedroom Housing Development Board (HDB) flat – quality similar to a presentable private apartment in KL - varies from S$2,200 to S$3,000 per month. Three-room private condominiums are higher –
above S$3,000 to S$5,000 in locations outside the city centre, S$7,000 to S$15,000 in prime areas. In KL or PJ, many three-room middle-range apartments or condominiums are available around RM2,000 to RM3,000 per month whereas the higher end ones may fetch RM5,000 or very much above, depending on popularity of locations.  
(S'pore HDP flats that are of comparable standards as private apartments or condominiums in KL.)

The value of three-room HDB flats varies from S$350,000 to S$500,000 while private condominiums are valued above S$700,000, with those in and near the city centre priced anything above S$1 million. Comparatively, a condominium comprising three rooms and spanning 1,200 sq ft, say in PJ, can easily fetch above RM700,000. Posher ones with updated facilities are valued above RM1 million. Those in the heart of Kuala Lumpur city definitely cost much more.

We may conclude that housing affordability issues faced by middle-class Singaporeans
may not be worse off than their Malaysian counterparts.

Now, let us look at transportation. Cars are undeniably much more expensive to buy in Singapore. A popular Japanese 1.5 litres saloon is available for new ownership at RM77,000 in Malaysia. The same model is sold at S$114,000, inclusive of Certificate of Ownership (COE) for 10 years, in Singapore.

Many Singaporeans do not rely on personal vehicles for commutation in view of the well mapped out Mass Rail Transit (MRT) lines intricately linking to most parts of the island. I took the train from Bukit Batok to Orchard station - 18 stops from end to end. The fare quoted by the ticketing machine was S$2.30. In comparison, the normal fare for the Light Rail Transit (LRT) ride between Taman Bahagia station in PJ and Masjid Jamek station in KL (my frequent points of commutation),
covering 10 stations, is RM2.10.

The bus services network is also another convenient public transport in the island, with sufficient fleets plying in high frequency. Fares are reasonable too. I took bus No 171 from Upper Bukit Timah to Newton, about 45 minutes ride under normal traffic flow (not too sure of the exact distance but approximated it to be about 6 miles or 10 kilometres). My fare was only S$1.50.  Even metered taxi fares are more or less at similar levels as in Kuala Lumpur.

Car ownership is not an ultimate necessity for the middle and normal working classes in Singapore since convenient and economical public transport systems have been accepted as efficacious alternatives for daily commutation. To many of them, especially expatriates, the high price of cars is not of concern.

And what about the medical treatment fees charged by hospitals? For simple illustration, let us view two simple surgeries – appendectomy and cataract removal. According to my web search, appendectomy charges vary around the average of S$5,000 to S$7,000 levied by government hospitals. Average charges imposed by private hospitals are around S$15,000 to S$16,000 (one to two bedded room stay). As for day surgery of cataract, government hospitals charge S$1,000 to S$2,000 while in private hospitals the average cost varies between S$3,000 and S$9,000. In KL
or other cities in Malaysia, the quantum for such surgeries may not be less - albeit civil servants, senior citizens and the low income group may be accorded either free services or nominal charged services in government hospitals. Singapore nationals and permanent residents compulsorily participate in healthcare schemes managed by the Central Provident Fund. Treatment costs are
charged to the medical card issued to individuals. Cost is hence not so much an issue to the nationals and permanent residents.

Many economy-minded middle-class Malaysians work in Singapore, stay in JB, own homes in JB, own cars in JB but commute daily for work by the shuttle buses linking the two cities, earn in Singapore Dollar and meet household expenses in Ringgit. Imagine a 35-year-old manager earning S$10,000 a month. At the current exchange rate, that would equate to approximately RM27,000. The young executive could live elegantly with his household on Malaysian soil! This is the advantage of earning Singapore Dollar income and spending Malaysian Ringgit household expenditure. In like mind set, many Singaporeans are looking at JB, especially the new Iskandar development area, to set up homes. Instead of paying S$400,000 to S$500,000 for one HDB flat, they know they can acquire a spacious up market landed property in JB with the same amount of money converted to Ringgit. When the planned MRT extension line to JB materialises, hopefully by 2018, two-way
commutation for both Malaysians and Singaporeans working in Singapore but residing in JB will be an imminent daily affair.

Putting aside the earning power and cost of living, what about the quality of life in Singapore vs Malaysia? The island nation may suit those attracted to modern cosmopolitan environment, in particular the young urban professionals. But due to the “compact” territorial size and intense physical development, the look and feel of life there seems to be a bit homogenous.

KL, in contrast, has better flair. We have Malay kampung (Malay village) environment, like
Kampung Pandan. We also have Chinese new villages sited just outside KL city. We have more traditional food flavours originating from different states operating in KL.  We have many eateries open for 24 hours a day or at least past midnight. In any established residential area,
eateries are within easy reach for late supper. Out of the city in the jungle suburbs, are rough terrains ideal for 4-wheel truck adventure enthusiasts to embark on thrilling expeditions. KL is linked to other cities and towns in peninsular Malaysia by connected roads; people in the capital city can frequently go for outings. Anglers looking for fishing spots may not have to go out to sea. They can
instead turn to disused (wild) mining ponds or commercial fishing ponds which are available in the suburbs not far from the city. Or if they are keen to go further distance for the sake of more exciting challenges, then travel to large lakes in other states like Kenyir Lake (in the state of Trengganu), Perdu Lake (in the state of Kedah), Temenggor Lake (in the state of Perak) where fishing boats are available for hire. The nearest coastlines for outward sea fishing on larger boats serve yet another alternative. Those preferring a rustic lifestyle can run orchards or fish farms in the suburbs.

Summary: My personal contention, based on the presentation above, is that the cost of living in Singapore VS in KL may not differ much. Again, bear in mind people working in Singapore are remunerated in Singapore Dollar at averagely higher wage levels. Thus, with reasonably priced necessities, the normal means of livelihood may not be costlier than their counterparts living in KL. For those who do not mind an ambience leaned toward homogeneity, perhaps they will find
the small city nation palatable for stay-in.

Note to readers:  If your opinions do not concur with mine, please feel free to share and post your comments.