PropertyGuru survey reveals Singaporeans react positively to National Day Rally 2023’s HDB housing policy changes

PropertyGuru, the leading property marketplace in Singapore, unveiled insights from its most recent Consumer Sentiment Study on Monday (11 Mar), illuminating Singaporeans’ perspectives on current housing policies and rental market conditions.

The bi-annual study, serving as a barometer for the property market’s mood among Singaporeans, discovered that 40% of the populace is optimistic about the HDB housing policy changes introduced in August 2023.

At the National Day Rally on 20 August 2023, Prime Minister Lee Hsien Loong announced new housing plans. These included a new classification of flats to replace the mature/non-mature estate classification, more housing options for single buyers, and initiatives to make HDB flats and precincts even more senior-friendly.

These initiatives, designed to make HDB flats more affordable and accessible, have been particularly well-received among the high-income bracket and younger Singaporeans, aged between 22 to 39 years.

Conversely, the rental market presents a stark contrast, with 85% of renters finding rental prices too high. An astonishing 84% believe that further actions are required to mitigate the escalating rental costs. This sentiment resonates across various income groups, especially among those with lower incomes, who are increasingly struggling to cope with the rising cost of living while managing rental expenses.

The Property Sentiment Index, an overarching indicator of real estate satisfaction that encompasses factors like housing affordability and perceived government efforts, remained stable at 44 points. This reflects a steady, albeit cautious, optimism in the property market, notwithstanding economic uncertainties.

The policy changes regarding HDB flats, announced during the National Day Rally 2023, have been met with approval, indicating a shift towards making properties near key amenities more accessible and maintaining affordability in prime locations through measures such as subsidies and the introduction of a 10-year Minimum Occupation Period for Plus and Prime flats.

Dr Lee Nai Jia, Head of Real Estate Intelligence at PropertyGuru, emphasized the mixed reactions towards the allure of Prime Location Public Housing units, noting the necessity of closely monitoring market conditions and mobility trends for a comprehensive understanding of their impact.

The rental market continues to pose a challenge for many Singaporeans, with an increasing number resorting to decreasing their spending to afford rents.

The study forecasts a continued rise in rental prices, compelling more individuals towards more affordable rental options. Nevertheless, initiatives like the Provisional Parenthood Housing Scheme (PPHS) Open Market Voucher are anticipated to relieve some of this pressure by providing more housing options for those in urgent need.

Despite the potential for economic headwinds, the demand for residential properties remains robust, with 69% of Singaporeans intending to purchase a property within the next five years. The government’s endeavors to enhance housing affordability have been warmly received, as evidenced by the improved satisfaction with the real estate climate.

Dr Tan Tee Khoon, Country Manager for Singapore, highlighted the significance of real estate as a hedge against inflation, noting that the sector tends to appreciate over time, yielding substantial capital gains compared to other investments.