,Singapore

Home price hikes loom amidst improvement in housing affordability: RHB

Household income growth (4%) outpaced the 1.2% rise in property prices.

Singapore's price-to-income ratio, a "good' parameter to judge the current affordability of homes, has improved has shown positive development since 2010, RHB Research said in a report.

This particularly reflects the continued improvement of household income, which has grown by a CAGR of 4% over the last 10 years. By comparison, the median property price has grown by a CAGR of 1.2% over the same time period.

Given improved affordability, the brokerage thinks there is room for price increase. "As demand recovers, there is scope for developers to raise prices before they become unaffordable. Even by international standards, Singapore’s price-to-income ratio is more favourable to the likes of big cities such as London, Tokyo and Hong Kong," it said.

Behind the demand recovery is the improving job market and low-interest rate environment. "With the labour market tightening, wage pressures have started to build up. Meanwhile, Singapore's housing loan rate (calculated by the average of 10 finance companies) is among the lowest on record," RHB Research added.

This is despite various pre-emptive measures to reduce demand and speculative behaviour. The Total Debt Servicing Ratio (TDSR), Seller’s Stamp Duty, and Additional Buyer’s Stamp Duty are still in place.

"These measures have been successful in curbing the influx of overseas money. Yet demand from Singaporean buyers remains the primary driver of the private residential market's recovery. The proportion of domestic purchases increased to 75% in 2017 from 64% in 2011," RHB Research said.

Join Singapore Business Review community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

Venture, Genting Singapore and Keppel Corporation showed the most growth.
Meanwhile, a record 583 non-landed homes sold for more than $2m each in the first nine months of the year.
The merger will create a flagship pan-Asia logistics and high-tech S-REIT.
It is followed closely by the identification app SingPass.
The index tracks REITs in the APAC region with higher dividend yields and positive environmental attributes.
Both companies will create training programs to support digital entrepreneurship and digital upskilling for Grab partners.
The deal is focused on M1’s network assets. 
This is a part of the Lion City's bid to become a global maritime knowledge and innovation hub.
Risks, however, are present with the financial troubles faced by the real estate sector in China. 
This comes as more Singaporeans turn to gaming in the midst of the pandemic. 
Retail sector has experienced the “most disruptions” with the changing restrictions.
The company was commended for being a global and regional sector leader in five categories.
The CEO designate said he aims to drive development in the company’s business units.   Gary Ho,  who played an instrumental role in the Initial Public Offering (IPO) of Nanofilm Technologies International Limited, has been appointed Chief Executive Officer of the company.
Analysts said strong leasing activity in Q3 played a factor.
Islandwide prime retail rents saw a dip by 0.6% q-o-q.