SINGAPORE: A recent white paper by ERA Realty reveals a significant surge in the proportion of young Singaporeans entering the private housing market, with the share of homebuyers aged 26 to 35 nearly tripling over the past eight years.
The report, authored by Wong Shanting, Head of Research and Market Intelligence at ERA, attributes this trend to rising income levels, a robust labor market, and improved financial literacy among the younger demographic.
In 2015, the study indicates that only 9 per cent of new private home sales were attributed to buyers aged 26 to 35. Fast forward to 2023, and this figure has soared to an impressive 35 per cent. The changing dynamics are also reflected in the median age of Singaporeans purchasing new private homes, which hit a record low of 39 years old last year, down from 45 in 2015.
While the younger cohort is making substantial strides, those aged 36 to 45 continue to be a dominant force in the private residential market, although their market share has dipped from 44 per cent in 2015 to 37 per cent in 2023.
Ms Wong believes that this shift in demographics signals a greater role for the younger generation in the private housing sector. She attributes this trend to higher wages and enhanced financial literacy, factors that have enabled younger Singaporeans to pursue homeownership goals more effectively.
She said, “New private homes are more accessible for young Singaporeans with growing income. The progressive payment scheme associated with new private homes supports individuals who may not have the immediate financial capacity for a full mortgage payment.”
The property expert added, “Equally so, the healthy overall employment rate in Singapore is a likely contributor to the growing number of young local private home buyers.”
Noting the inclination of Singaporeans aged 18 to 35 towards investment, Ms Wong suggested that such investments could have aided this demographic to save up for the initial downpayment on their first homes.
She noted, “Private homes offer opportunities for capital appreciation and passive incomes, aligning closely with young Singaporeans’ views on investing and building financial security at an early age.”
As the private housing market witnesses a generational shift, the data suggests that the younger demographic is set to exert a more pronounced influence in the years to come, driven by a combination of economic factors and a growing financial acumen among Singapore’s youth.