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...
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 …
The Top 5 Factors to Consider When Investing in Industrial Property in Singapore – Expert Insights!
Singapore, a thriving hub of business and commerce in Southeast Asia, offers a robust real estate market with various investment...
Read More
Singapore Property Bubble Ahead? My Friends Share My Market Predictions
TLDR The author delves into various opinions on the Singapore property market for the year 2023. Experts have differing views...
Read More
Executive Condos in Singapore: Have They Outgrown the “Sandwich Class” Label?
TLDR The Executive Condominium (EC) scheme, once intended as affordable “sandwich class” housing, is now acting more like a lottery...
Read More
Top 5 Factors to Consider When Choosing a Property in Singapore
The top 5 factors to consider when choosing a property in Singapore. Whether you're a seasoned investor or a first-time...
Read More
Are You Worried About Overpaying On Your Property? Here’s The Secret To Finding Out Its Perfect Purchase Price!
TLDR Understanding property valuations and their impact on mortgage loans is crucial in the Singapore real estate market. By considering...
Read More
Invest During the Bearish & Exit During the Bullish
TLDR A comprehensive overview of the real estate market trends, emphasizing the importance of strategic property analysis and investment decisions....
Read More
Step-By-Step Guide To Buy Resale HDB (Updated March 2023)
TLDR The process of purchasing a resale HDB flat involves steps such as checking eligibility, calculating affordability, registering intent to...
Read More
Dual-Key Condo: Analysing The Pros And Cons
TLDR for "Dual-Key Condo: Analysing The Pros And Cons" When considering dual-key condo units, it's important to weigh the advantages...
Read More
Lessons from the Rollercoaster Ride: Homebuyers Share Their Singapore Housing Market Experiences
TLDR The Singapore housing market is a rollercoaster of unpredictable changes. Three homebuyers share their experiences: Tristan waited too long...
Read More
Beware! Spot These Warning Signs Before Making a Home Purchase!
TLDR When purchasing a property in Singapore, it is crucial to thoroughly assess various aspects of the home to avoid...
Read More
The Shifting Landscape: Why More Singaporeans Are Opting for Larger HDB Flats Over Condos for Upgrades in 2025
TLDR By 2025, more Singaporeans are choosing larger HDB flats over condominiums as their upgrade path. Rising condo prices, especially...
Read More
Top 5 Museums in Singapore for Art and History
Singapore, known for its vibrant culture and rich history, is home to a plethora of museums that cater to art...
Read More
Top 5 Rooftop Bars in Singapore with Amazing Views
Top 5 Rooftop Bars in Singapore with Amazing Views Singapore, the Lion City, is known for its stunning skyline and...
Read More
When to Strike Gold: The Ultimate Guide to Selling Your House in Singapore!
TLDR When deciding the best time to sell your property, consider various factors such as market trends, financial goals, and...
Read More
Why Can’t We Buy Low, Sell High?
Madam Tan voiced that approximately two years ago, when her apartment hit its minimum occupation period, she and her spouse...
Read More
Exciting News: Affordable Housing in Singapore by 2024?
TLDR The real estate market in Singapore is experiencing shifts in housing supply and demand, influenced by factors like mortgage...
Read More
Top 5 Best Unique Nighttime Experiences in Singapore
Singapore, a vibrant city-state known for its stunning skyline and diverse culture, truly comes alive at night. As the sun...
Read More
Learn the Essentials of Renting Property in Singapore as a Foreigner
TLDR Renting in Singapore offers various options for foreigners, such as HDBs, Condos, and even unique properties like heritage homes....
Read More
Top 5 Places to Learn About Singapore’s Diversity
Singapore, a vibrant city-state in Southeast Asia, is well-known for its diverse culture and rich history. A melting pot of...
Read More