Over Third Hdb Owners Feel Priced Out Private Housing Propnex Poll
PropNex Realty’s recent survey results revealed that more than a third of HDB buyers feel that they are priced out of the private residential market, and that they may never be able to afford a private home in Singapore.These findings were published on July 22 and were obtained through surveys of 1,250 existing HDB homeowners. The survey delved into their attitudes towards upgrading from public housing, sentiments on housing prices, and their views towards upgrading into the private residential market.According to the survey, close to 450 (36%) of respondents indicated that they believe they will never be able to afford a private home, while 225 (18%) of respondents stated that it would take them 5–10 years to afford a private home. A smaller group of 125 (10%) said that it would take them more than 10 years before they could afford an upgrade to a private home.Only 75 (6%) of respondents said that they could upgrade to a private home in the next year.Even with these financial constraints, close to half of the respondents still aspire to upgrade from their current public housing to either a larger HDB flat or a larger private residential property.In the survey, 263 (21%) expressed interest in moving into a larger HDB flat, and 338 (27%) stated their desire to reside in a larger private residential home in the future. Meanwhile, 38% said that they have no immediate plans to move, and 8% plan to “right-size” to a smaller home.According to PropNex Realty CEO Ismail Gafoor, “It is fair to say that HDB flats are a staple of housing in Singapore and will continue to be home to the majority of the population. However, we know that one of the aspirations of many Singaporean households is to own and live in a private home.”The PropNex survey also revealed that high home prices and the existing Additional Buyer’s Stamp Duty (ABSD) regime are the primary deterrents preventing most HDB homeowners from upgrading to the private residential market.Under the current ABSD system, HDB homeowners must pay a 20% ABSD upfront (being their second residential property) before they can apply for an ABSD remission. However, this is subject to them meeting the remission conditions.“To this end, perhaps the government can consider aligning the ABSD treatment for flat owners wishing to upgrade to a private home, with that of those looking to purchase new executive condos (ECs) from developers,” Gafoor suggests.At present, HDB owners upgrading to an EC are not required to pay a large ABSD payment upfront. They are allowed to live in their existing flat, but they are required to sell their HDB flat six months after their new EC receives its temporary occupation permit (TOP).Additionally, close to 60% of the survey respondents stated that high private home prices have also discouraged them from moving up.The survey also showed that over the first six months of the year, the average price of new non-landed private residential units in the suburbs, or Outside Central Region (OCR), was approximately $1.9 million. Meanwhile, the average price of resale non-landed private units in the OCR was around $1.5 million.In the HDB resale market, the average price of a five-room flat in the first half of 2024 was approximately $714,000, while the average resale price of a four-room flat was about $609,000, and executive flats fetched around $861,000.“HDB resale flats may be seen as more affordable options over private homes for some HDB flat owners looking to relocate,” says PropNex Realty head of research and content Wong Siew Ying.
Meanwhile, more than half of the respondents (50% +) said that they are not open to selling their flat at a discounted price in their area. Similarly, 87% said that they expect to sell their property at a price premium over the market rate in their area.Wong also notes that most HDB homeowners view their flat as a home and are generally in no hurry to sell. “Close to three quarters (74% of survey respondents) either agree or strongly agree that their present HDB flat meets their housing needs adequately,” she says.Their HDB flat is viewed as a retirement nest egg, and an investment tool to help build wealth, with less viewing it as a legacy asset or a store of wealth. This is largely attributed to the negative price impact of the lease decay on property value over the long term, she explains.“Home buyers generally remain cautious and price-conscious amid elevated interest rates and peaking home prices,” Wong points out. On the other hand, she also adds that the private residential market could see overall private home prices climb by 4%–5% this year.Meanwhile, most HDB homeowners are looking to more affordable homes in the secondary public housing market, indicating a healthy demand for resale HDB homes.The survey suggests that PropNex expects HDB resale prices to climb by 6%–7% this year.Read more: “Real clients first”: Finding solutions for property progression in Singapore to meet clients’ real needs
According to a recent survey by PropNex Realty, more than one-third of homebuyers in Singapore feel that they are priced out of the private housing market. These buyers do not believe they will ever be able to afford a private home in the country.
The survey, published on July 22, was conducted on 1,250 existing HDB homeowners by real estate agency PropNex Realty. It aimed to understand these homeowners’ attitudes towards upgrading from public housing, their sentiments on housing prices, and their views on upgrading to the private residential market.
Out of the respondents, 450 (36%) stated that they believe they will never be able to afford a private home, while 225 (18%) estimated it would take them 5–10 years to afford one. A smaller group of 125 (10%) said it would take them more than 10 years to upgrade. Only 75 (6%) said they could afford an upgrade in the next year.
Despite these financial constraints, nearly half of the respondents still aspire to upgrade from their current public housing to either a larger HDB flat or a larger private residential property in the future.
263 (21%) expressed a desire to move into a larger HDB flat, and 338 (27%) stated their intention to reside in a larger private residential home. Meanwhile, 38% said they have no immediate plans to move, and 8% plan to “right-size” to a smaller home.
Ismail Gafoor, CEO of PropNex Realty, said, “It is fair to say that HDB flats are a staple of housing in Singapore and will continue to be home to the majority of the population. However, we know that one of the aspirations of many Singaporean households is to own and live in a private home.”
The survey also revealed that high home prices and the existing Additional Buyer’s Stamp Duty (ABSD) regime are the primary reasons that deter most HDB homeowners from upgrading to the private residential market.
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Under the current ABSD system, HDB homeowners must pay a 20% ABSD upfront (being their second residential property) before they can apply for an ABSD remission, which is subject to them meeting the remission conditions.
Ismail Gafoor suggests that the government consider aligning the ABSD treatment for flat owners wishing to upgrade to a private home with that of those looking to purchase new executive condos (ECs) from developers. Currently, HDB owners upgrading to an EC are not required to pay a large ABSD payment upfront. They are allowed to live in their existing flat but are required to sell their HDB flat six months after their new EC receives its temporary occupation permit (TOP).
The survey also revealed that more than half of the respondents (50%+) are not willing to sell their flat at a discounted price in their area, while 87% expect to sell their property at a price premium over the market rate in their area. Wong Siew Ying, Head of Research and Content at PropNex Realty, noted that most HDB homeowners view their flat as a home and are generally in no hurry to sell.
Furthermore, the survey showed that buyers do not view their HDB flat as a legacy asset or a store of wealth due to the negative price impact of the lease decay over the long term. Wong Siew Ying says, “Home buyers generally remain cautious and price-conscious amid elevated interest rates and peaking home prices.” However, private residential market prices may still climb by 4%–5% this year.
The survey also suggests that PropNex Realty expects HDB resale prices to rise by 6%–7% this year.
Read more: “Real clients first”: Finding solutions for property progression in Singapore to meet clients’ real needs