Aerial view of crowded Singapore high rise apartment skyscraper buildings.

Singaporeans are able to afford property despite finding prices high, says PropertyGuru survey

Based on a survey conducted by PropertyGuru Group, it was revealed that Singaporeans are now being more positive about the property market due to the increased in affordability, ease of getting financing, good long-term prospects and government policies.

The results, which came out in the leading property technology company’s bi-annual Consumer Sentiment Survey, was conducted on 643 people in Singapore and more than 3,400 respondents across Southeast Asia.

It was said that while 88 percent of the Singaporeans surveyed believe that property prices are high and 72 percent expect these to increase in the next six months, a significant proportion (66 percent) see 2 property in Singapore as not only affordable but also good value for money.

In fact, 64 percent shared that they are able to buy a home at the current prices and within their current incomes, with 27 percent intending to buy a home in the next year.

“With prices in the private property market starting to see declines from cooling measures, and the HDB resale market remaining flat, buyers are likely to consider entering the market in 2019. Furthermore, with at least 40 new launches expected to hit the market this year, private property buyers will have plenty of options to choose from. Despite macroeconomic uncertainties, we see from our sentiment survey that there remains a firm belief in the long-term potential of Singapore’s property market,” said Jeremy Williams, Chief Business Officer of PropertyGuru Group.

The survey also found out that 41 percent of the respondents indicated satisfaction with Singapore’s real estate climate due to the long-term prospects for capital appreciation, stable real estate market and local economy.

What is even more interesting is that more than half of the respondents who are satisfied with the real estate climate are PMEBs (Professionals, Managers, Executives and Businessmen) aged 30 to 49 years, drawing medium to high incomes and are married with children.

“Many within this demographic group have experienced what we call the ‘first bite of the cherry’, having made some money when selling their matrimonial home that has enabled them to upgrade to their next home. As such, these individuals are most likely to view real estate as a means of growing their nest egg for the future,” Mr Williams added.

However, for 39 percent of those surveyed, restrictive government policies remain a matter of contention and there is rising dissatisfaction not only with increasing property prices but also with small unit sizes that come with these high price tags.

If that is not all, those who are thinking of upgrading to private property, positive perception rose the highest for executive condominiums (ECs) by 6 percent as these are available at relatively affordable prices compared to increasingly expensive condos. ECs are also a favourable option for middle income families who aspire to own private homes and enjoy long-term capital appreciation prospects.

Adding to the good news, the survey also found out that more young Singaporeans are moving out of their family homes earlier. At least 24 percent of millennials who moved out of their parents’ homes were aged 27 and below, with two in three respondents owning their first property between the age of 28 and 34 years.

This is could be due to the rise of co-living concepts where people rent or purchase properties together, lowering the price of the overall unit and making it more achievable.

However, PropertyGuru advices property seekers, particularly first-time buyers, to time their purchases to the ebb and flow of property prices and policy changes, such as cooling measures and property tax rates.

In addition to assessing future prospects of the preferred location, the company also recommends that buyers have sufficient savings for a down-payment and are able to service their property mortgage loan in the long-term – after accounting for renovation, stamp duty and setting aside six to 12 months of salary for emergencies.