PropertyGuru Group, ("PropertyGuru" or the "Group"), Asia's leading property technology company, today revealed that Singaporeans are more positive about the property market in its bi-annual Consumer Sentiment Survey – citing increased affordability, ease of getting financing, good long-term prospects, and government policies as key reasons for their optimism.
Conducted in H2 2018, the Sentiment Index, a score which measures current real estate satisfaction, affordability, real estate climate, interest rate situation, perceived government efforts,
and property prices increased to 45 from H1 2018's score of 39.
Jeremy Williams, Chief Business Officer, PropertyGuru Group said, "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."
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 the local economy.
Interestingly, 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 the 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," 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.
Properties are affordable and value-for-money despite the perception of high prices
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 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.
Executive condominiums (ECs) are popular among property upgrades
Compared to H1 2018, there has been an increase in respondents' intention to buy a
condominium (by 22 percent), landed property (by 20 percent), and mixed-use development (by
32 percent), within the next six months. For those keen on upgrading to private property, positive
perception rose the highest for 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.
Millennials are able to afford homes earlier
There is a growing trend of young Singaporeans 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. The
increased affordability 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.
Property seekers, particularly first-time buyers, are advised to time their purchases to the ebb and
the 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, PropertyGuru 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.