Property affordability sentiment in Singapore remains low with a score of 29 for the first half of 2017, according to PropertyGuru Group’s recently-released Consumer Sentiment Survey.
The findings remain unchanged from 2016, reflecting a continued sense of consumer pessimism and highlighting a gap between consumers’ views on affordability, and the anticipation of a market turnaround in the real estate industry.
PropertyGuru’s latest Consumer Sentiment Survey H1 2017 revealed that the property affordability sentiment remains unchanged from 2016’s 29 points, despite recent signs of market recovery and generally lower property prices across property types.
This sentiment is measured by factoring in consumer perceptions on the real estate market
and a value for money rating. It also takes into account external realities, such as the interest
rate situation, perceived government efforts and anticipated property prices in the next one to
Overall consumer satisfaction with the real estate climate has improved since its lowest point in 2013.
The most recent survey however indicated a small dip of two per cent, from 36 per cent in 2016, to 34 per cent in the first half of this year. The top-cited reason for satisfaction with the real estate climate were the good prospects for long-term capital appreciation. This measure increased from 14 per cent to 29 per cent from 2016.
On the flip side, overpriced properties remain the top reason cited for dissatisfaction with the real estate climate, with seven out of 10 respondents attributing it to their negative sentiment.
Furthermore, only 32 per cent of the respondents felt that there were sufficient government
efforts to make housing more affordable.
Decrease in intent to purchase a property
While home ownership remains an important goal among Singapore respondents, high property prices have driven the intent to purchase a property in the next six months fall from 57 per cent in 2016 to 49 per cent in H1 2017.
Among those who are keen to enter the real estate market in the next six months, there is greater interest in the resale market with almost eight out of 10 prospective home owners open to purchasing a resale home.
Location factors, including distance to schools and work places are a key consideration in the property
buying process. Mature estate District 15 (East Coast / Marine Parade), followed by the developing estate in District 19 (Hougang / Punggol / Sengkang) and centrally located District 10 (Tanglin / Holland) are preferred locations for prospective home owners.