88% of Singaporeans unhappy about property market due to prices

About 27% think condo prices will climb by over 10%.

Singaporeans remain worried of high prices in the property market, PropertyGuru revealed. About 88% cited this as the key reason why they remain unhappy about the property market.

PropertyGuru’s consumer sentiment index for the first half of 2018 remained at 39 points similar to the score in H2 2017. The index is calculated based on six parameters including satisfaction, housing prices, and consumers’ future expectations of the market.

According to an accompanying survey, consumers see private home prices rising steeply in the next five years. About 27% predict that condo prices will climb by over 10%, whilst a quarter (25%) think that landed homes will rise by the same. Only 13% of survey respondents think that HDB prices will increase by a tenth from today’s prices.

“With buyers now having to fork out more cash upfront, these recent moves have made it more expensive to consider property as an investment option,” PropertyGuru chief business officer Lewis Ng commented. “Sellers looking forward to a market recovery to sell their properties might feel some frustration as well, especially en bloc hopefuls who did not manage to see their sales go through prior to the measures.”

Even before the government tweaked measures to slow the growth of property prices, only 27% felt that the government was doing enough to make housing affordable. About 53% felt that the prices of newly-launched properties should be regulated, whilst 49% thought that more restrictions on foreign ownership should be imposed.

Moreover, close to half of the respondents surveyed felt that cooling measures should be relaxed. Of these, 80% wanted the ABSD for the purchase of second and subsequent properties to be reduced.

Other policies that respondents indicated should be relaxed include the caps on the%age of monthly income that can be used to service housing loans – Total Debt Servicing Ratio and Mortgage Servicing Ratio, PropertyGuru added.

About 39% of millennials (those between 21 to 37 years of age) surveyed currently live with their parents. Of these, a majority (66%) are looking to purchase a home. The key regions millennials are looking at for their future home include the central, northeastern and eastern parts of Singapore.

However, a whopping 69% of millennials stated that they do not have a structured savings plan to finance their housing purchase. “Millennials who do not intend to move out of their parental home also indicate the lack of sufficient savings for their own home purchase as the primary reason for their decision,” PropertyGuru added.

Other reasons for choosing to remain in their parental home include not being married and hence being unqualified for an HDB flat (44%) and high property prices (33%).