With prices undeterred by the onslaught of cooling measures, affordability remains a major concern for home buyers in Singapore, according to a new survey by property portal, iProperty Group.
The number of people who are stalling their buying decisions have almost doubled since last year. Almost three in four Singaporeans are putting off their purchase decisions, up from about two in five.
"Buyers are hesitant, but with no real declines expected, waiting is unlikely to result in any real savings," said Sean Tan, general manager, iProperty.com Singapore.
As an indication of the muted demand, new private home purchases are down 73 percent to 481 units in July, from 1,806 units in June, according to Urban Redevelopment Authority.
Beyond private homes, the issue of affordability further extends to public housing with a three-fold increase (61 percent, up from 23 percent) of respondents said HDB prices are not affordable to the average Singapore family.
Three in five Singaporeans have also called for additional measures to be implemented, in bid to improve affordability.
"If home prices do not change or decrease [...] then it's more than an economic issue, it will become a social issue in the long run," warned Tan.
Investors over home buyers
Among property buyers, the survey has also found that most are looking for investments over home stay. Buyers are motivated by long-term investments (51 percent, up from 30 percent); rental income (46 percent) and home ownership (40 percent).
For investors, new residential launches (68 percent) are favored over existing properties (22 percent).
With cooling measures sending headwinds to residential investments, many investors are exploring alternative portfolios of commercial and overseas properties.
Greener pastures offshore
A renewed exuberance maintains for investment opportunities overseas. Forty percent of respondents said they were considering overseas investment, up from 38 percent last year.
Although Malaysia still registers the largest interest among locals, it has dipped by three percent, from 42 percent to 39 percent.
Australia, on the other hand, has seen the largest surge of interest, from 15 percent to 19 percent.
Tan attributed the sudden interest to the recent favorable exchange rate, as well as Australia's success in "marketing themselves as a retirement hub for Singaporeans."
Similarly, Thailand has also become popular, with interest increased from seven percent to nine percent.
By and large, the top five preferred investment locations by Singaporeans are Malaysia, Australia, Thailand, United Kingdom and the United States.
Not included in the findings is the recent upswing of interest for Makati, the financial centre of the Philippines.
"The entry point is generally low and Makati is seen as the next coming development if you look at South East Asia, apart from Iskandar," Tan added.
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