Homeownership Desire Upgrade Still Strong Among Youths Era Survey
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Singapore’s First-Time Homebuyer Farah to Get BTO Flat Keys in 2028
Farah, a first-time homebuyer, is set to receive the keys to her five-room Build-to-Order (BTO) flat in Tengah in 2028. Currently aged 27, Farah has plans to upgrade to a private condo after fulfilling the five-year minimum occupation period (MOP).
According to Farah, buying a private condo is crucial as she believes that private property prices have been on a steady rise in recent years. She is confident that owning a private condo will be a lucrative investment for her future.
Farah’s ultimate goal in real estate is to upgrade to a private condo, and she believes that purchasing a five-room flat is the way to make it happen. She and her partner are expecting to earn a profit from selling the BTO flat and use it to upgrade to a private condo. They also want the extra space in case they have children or if their parents or in-laws decide to move in with them in the future.
The ‘Singapore Dream’
The ‘Singapore Dream’ is a term often used to describe the material aspirations of Singaporeans, which includes owning a private property for personal use and investment purposes. Despite changing values and ideals among younger generations, home ownership and investment remain significant goals for Singaporean youths. This was revealed in a survey conducted by ERA Singapore in collaboration with Ngee Ann Polytechnic, School of Design and Environment, published on Aug 14.
The survey showed that while most Singaporeans are satisfied with their current housing arrangements, they still have a strong desire to upgrade. 34% of those who plan to purchase their next property are looking at private condos, 29% are interested in HDB resale, while others consider BTO flats, executive condos, and landed properties.
Gen Z Aspirations
The survey revealed that 85% of Gen Z respondents (aged 21 to 27) view home ownership as important, and 35% plan to buy a property within three to five years. However, only 24% of them currently own their homes.
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Among the Gen Z respondents, 23% plan to buy an HDB resale, while 59% are eyeing a BTO flat as their first home. Additionally, 59% of Gen Z respondents plan to upgrade to a private condo in the next three to five years.
One such Gen Z is Hanan Zailani, who is currently shopping for a four-room HDB resale flat with her fiancé. The 25-year-old believes this is the most affordable option for them at the moment, but she has plans to upgrade to a five-room flat in the future, especially since they are considering having children or having family members stay with them.
Millennial Housing Goals
Similarly, millennial respondents (aged 28 to 43) also have strong aspirations for home ownership and upgrading. The survey showed that 35% of millennials aspire to own a private condo.
The majority of millennial condo seekers (54%) are targeting a price range of $1 million to $2 million for their next property, while 20% are willing to invest between $2 million and $3 million.
The survey also showed that 45% of millennials are interested in purchasing an HDB flat, with 62% willing to spend between $500,000 and $1 million. According to HDB resale transactions in 1H2024, 97% of homes were sold for less than $1 million.
One millennial who prioritizes home ownership is Ms Ong, who is currently in her 30s. She went through four rounds of balloting before finally securing her five-room BTO flat. Owning a home has not been an easy journey for her, but she says she would do it all over again just to have her own home.
Space vs Affordability
The survey showed that many respondents prefer to have at least three rooms in their homes, underscoring the importance of offering a variety of housing options. Specifically, 19% of respondents aim to live in a three-bedroom or larger private condo, while 19% prefer a four-room or larger HDB flat. Meanwhile, a smaller percentage prefers homes with fewer rooms.
The desire for more spacious homes, however, is tempered by affordability concerns. Property prices, high interest rates, property tax, the inability to secure a larger loan, and Additional Buyer’s Stamp Duty (ABSD) are some of the challenges that Singaporeans face in fulfilling their homeownership aspirations.
According to the survey, 25% of respondents are concerned about the affordability of private homes, and this aligns with transaction data from 1H2024, where 64% of non-landed transactions were priced below $2 million, and another 26% were in the $2 million to $3 million range. Of these, 26% were in the Rest of Central Region (RCR).
The price gap between new and resale homes remains substantial, with median prices in the RCR and Outside Central Region (OCR) showing a difference of nearly 37% and 39%, respectively.
The survey also revealed that 17% of respondents are worried about the impact of interest rates on affordability, while 16% are concerned about their loan eligibility. Another 13% agree that ABSD is a significant obstacle to purchasing their next home.
Despite these challenges, the majority of potential buyers are willing to spend to secure their ideal living space, emphasizing the importance of homeownership as a cherished goal for many Singaporeans.
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