5 Reasons Why Timing the Singapore Property Market is a Risk You Shouldn’t Take
5 Reasons Why Timing the Singapore Property Market is a Risk You Shouldn't Take Entering the Singapore property market can...
Read More
Is The Condo Dream Getting Increasingly Harder To Achieve For Singaporeans?
TLDR
Condominium prices in Singapore have nearly doubled over the past 15 years, with new launches now averaging around $2,390 psf. A typical 1,000 sq ft three-bedroom condo costs about $2.39 million, aligning with the income growth of the top 20% earners who mostly buy such properties. While prices feel high compared to 2009, affordability has remained relatively stable when accounting for income increases. New launch condos have grown more expensive compared to resale units, which may offer better value despite renovation costs. The housing market reflects limited land and population growth, making condos aspirational but still attainable for the higher-income segment. Buyers and sellers should consider their individual circumstances and market data for decisions. Expert advice can help navigate this complex market effectively.
For many Singaporeans, owning a condominium has long represented a significant life aspiration, often considered the pinnacle among traditional material achievements. Given Singapore’s limited land, growing population, and economic progress, the steady rise in housing prices, particularly for condominiums, comes as no surprise. Recently, a new freehold condominium in District 15 reportedly sold for over $3,000 per square foot (psf). While District 15 has gained popularity and the development boasts an excellent location with amenities, such a price point prompts questions about affordability.
While $3,000 psf might seem an outlier today, it could hint at future price trajectories. According to Stacked Homes, new condo prices averaged $2,390 psf in September 2024. This implies a typical 1,000-square-foot, brand-new three-bedroom condominium unit would cost approximately $2.39 million. At first glance, this price appears far from affordable for the average Singaporean.
Indeed, it largely is. Singapore’s housing system sees about 80% of its population residing in public HDB flats, with the remaining 20% in private properties, including condominiums, apartments, and landed homes. Consequently, condominium prices tend to align with the income levels of Singapore’s top 20% earners—the demographic most likely to purchase such properties, especially new launches. Therefore, it’s logical that condo prices have risen in tandem with income growth in this segment over the past two decades.
Property Price Growth Over the Last 15 Years
The Urban Redevelopment Authority’s (URA) Property Price Index (PPI), which tracks residential property prices (including non-landed properties), stood at 197.5 in Q3 2024. With Q1 2009 as its base year, this indicates a roughly 98% increase in condominium prices over the past 15 years, essentially doubling.
This data often leads to two common observations:
- For Existing Condo Owners: If you purchased a condominium around 2009, your unit’s value might not have appreciated by the full 98%. For example, an $800,000 unit then might now be worth $1.4 million—a significant 75% appreciation, but short of the index’s figure.
- For New Condo Buyers: Today’s buyers might lament the “good old days” when a new three-bedroom condo cost around $800,000, contrasting it with today’s $1.8 million price tag for a similar unit (a 125% increase).
This discrepancy arises because the PPI reflects overall private non-landed residential property prices, encompassing both new launches and the resale market. Stacked Homes data reveals a significant widening of the price gap between new launches and resale condominiums over the last decade. In 2013-2014, new launch condos over 1,200 sq. ft. were only 6%-17% more expensive than resale units. By 2023-2024, this gap had expanded to 34%-53%.
This explains why existing condo owners might see substantial, yet not as dramatic, appreciation as the growth in new launch prices. For aspiring condo owners, resale condos might offer better value, although potential renovation costs must be factored in, as they can offset initial savings.
Income Growth vs. Property Price Growth
To assess affordability, it’s crucial to compare property price increases with income growth. Using data from data.gov.sg, the monthly household income from work per household member (excluding employer CPF contributions) for the 80th percentile increased by approximately 90% from $3,153 in 2009 to $6,008 in 2023.
Comparing this with the PPI, which rose about 94.1% from 2009 to Q4 2023, reveals a strong correlation. The rise in property prices has largely kept pace with the income growth of the top 20% earners.
Affordability Over Time
This comparison suggests that, despite the feeling of high prices, the overall affordability of a condominium unit in 2024 is statistically comparable to what it was in 2009. While absolute prices were lower in 2009, so too were household incomes. The market has adjusted, with property prices rising in tandem with the income levels of the segment that typically acquires them. Therefore, the “condo dream” remains aspirational, but statistically, it hasn’t necessarily become more difficult to achieve, given the corresponding income growth within the target demographic.
Should You Buy, Sell or Wait?
If you’re reading this, you must be trying to figure out the best course of action right now: is it the right time to buy or sell?
It’s difficult to give an exact answer since everyone’s situation is unique and what works for one person may not necessarily work for you.
I can bring you a wealth of on-the-ground experience and a data-driven approach to provide clarity and direction. From beginners to experienced investors, our top-down, objective approach will help you on your real estate journey.
I can help you by:
- Offering Strategic Real Estate Advice – I can help create a comprehensive plan to guide you through your property journey.
- Connecting Your Home with the Perfect Buyers – Through stunning visuals, an effective communication strategy, and an in-depth knowledge of the market, we’ll ensure your home is presented in the best possible way to fulfill your goals.
You May Also Like …
5 Reasons Why Condos Are The Best Real Estate Investment in Singapore
Investing in a condo in Singapore is a popular choice for both locals and foreigners. Condominiums offer a range of...
Read More
Top 5 Must-Try Foods in Singapore
Top 5 Must-Try Foods in Singapore Singapore, a melting pot of cultures and cuisines, offers a diverse and tantalizing array...
Read More
Planning for Retirement: Considerations for Downsizing Your Property
TLDR Downsizing your home for retirement can bring financial security, closer family ties, and new adventures. Consider the benefits of...
Read More
Top 5 Fine Dining Restaurants in Singapore if You are Visiting Us!
Top 5 Fine Dining Restaurants in Singapore if You are Visiting Us! Singapore is known for its diverse and delicious...
Read More
Top 5 : Greatest Challenges That Investors Face In Singapore’s Real Estate Market
Singapore's real estate market is a dynamic and attractive investment landscape for both local and international investors. Known for its...
Read More
ANALYSIS: Unveiling the HDB Towns with the Steepest and Lowest Price Surges!
TLDR The real estate market for HDB flats in Singapore has witnessed significant growth, with prices reaching new highs. The...
Read More
What Factors Contribute To Singapore’s Real Estate Market Exhibiting Less Volatility Than Other Major Cities?
TLDR The Singaporean real estate market has remained stable due to government cooling measures. These include Additional Buyer's Stamp Duty...
Read More
The Influence of Soaring Land Costs on Singapore’s Real Estate Market: A Look at Land Price Trends Since 1992
TLDR When it comes to understanding the fluctuations in land prices in Singapore, historical patterns reveal significant spikes and dips...
Read More
I Bought a Mega-Home : Hear 7 Homeowners Spill their Heartfelt Remorse
TLDR The article discusses various challenges faced by residents living in massive condo complexes in Singapore. From long elevator wait...
Read More
URA’s Draft Master Plan 2025: A Blueprint for 80,000 New Homes Across 10+ Estates
TLDR The URA Draft Master Plan 2025 outlines the creation of 80,000 new homes across more than 10 estates over...
Read More
What’s A Fair Price For An HDB Flat in 2025? A Savvy Buyer’s Guide
TLDR There’s no single “fair” price for HDB resale flats—what’s fair depends on your needs, motivation, and timing. To navigate...
Read More
Market Mistakes in Property Investment: Key Lessons and Strategies for Success
TLDR In property investment, common mistakes include lack of research, overleveraging, and neglecting due diligence. To succeed, conduct thorough market...
Read More
Discover 7 New Condos Close to an MRT Station in 2023
TLDR When it comes to finding the perfect home near MRT stations in Singapore, several exciting new launches stand out...
Read More
5 Key Factors that Affect Singapore’s Property Prices
Singapore, a thriving city-state known for its impressive skyline and robust economy, has one of the most dynamic and competitive...
Read More
5 Disastrous Property Transaction Nightmares (and How to Avoid Them)!
TLDR When attempting to sell your property, various worst-case scenarios can hinder the sale process significantly. These scenarios include buyers...
Read More
A Potential Game-Changer: Singapore’s Proposed Minimum Transaction Rule for Property Agents in 2025
TLDR In Singapore’s real estate market, experience alone no longer guarantees an agent’s competence. Many agents maintain licenses without significant...
Read More
5 Unexpected Factors That Make Some New Launch Condos Sell Like Hotcakes
TLDR The Singapore property market for new condo launches in 2023 saw varying degrees of success. Factors like limited competition,...
Read More
Should You Pay Extra for a Private Condo When the EC Next Door Looks Identical?
TLDR Singapore’s executive condominiums (ECs) have improved significantly, now matching private condos in design and facilities but at lower prices....
Read More
The Top 5 Reasons To Invest In Singapore Property
Singapore, a small island nation with a thriving economy, has long been considered an attractive destination for property investment. The...
Read More