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5 Facts You Probably Didn’t Know About the Singapore Property Market
By Marcus Sim (guest contributor)
Fact #1 – Singapore Has a Higher Population Density than Hong Kong
Many people regard Hong Kong as one of the countries with the highest population density in the world. To a large extent, this is true. Based on their population of 7,182,724 (July 2013 estimate) and their land size of 1,054 square kilometers (sqkm), the population density works out to be 6,815 Residents per sqkm!
However, did you know that Singapore has a much higher population density?
Our 5,460,302 strong population is packed into a mere 687 sqkm land size which means that for every square kilometer, there are 7,948 people! Based on worldwide statistics, Singapore is currently ranked as the 3rd most densely populated country in the world, followed by Hong Kong at a close 4th. The top spot for population density goes to Macau with 20,069 residents for every square kilometer.
It is no wonder that the Singapore Government has ongoing plans to increase land size via reclamation to refrain from claiming the crown from Macau. Land scarcity is a very real problem for Singapore which explains the ever-increasing land costs and property prices which are driven by pent up demand.
Fact #2 – If Singapore Reaches the Targeted 6.9 Million Population by 2030, the Population Density Will Rise Above 10,000 Residents per SQKM
At the projected 6,900,000 population by year 2030, Singapore will hit an approximate 10,044 residents for each square kilometer.
That is a huge number of people!
Fact #3 – ECs Have the Highest Vacancy Rate
Strangely enough, even with the high population in Singapore today, there are still unoccupied houses in Singapore!
Vacant units affect the property rental market directly. Generally the higher the vacancy rates, the weaker the rental market.
It is also interesting to note that Executive Condominiums (ECs) have the highest vacancy rates (10.38%) among the different private property categories.
Perhaps, there is a disparity between the rental expectations of EC owners and their prospective tenants.
Fact #4 – The Average Household Size in Singapore is Just 3.53
Did you also know that the average household size of families in Singapore is a mere 3.53? (In 1990 it used to be 4.25)
Shrinking household sizes affect the property markets in a couple of ways.
Developer new launches are offering a greater number of smaller units to cater to this trend.
Developers are aware of this trend and will likely continue to offer more “shoe-box” and smaller sized units in their new launches which are more affordable to the average buyer in Singapore.
Demand for larger sized units will decrease
Developers are less likely to build condominium units with a larger square footage as it will be too high in terms of price quantum and generally not well received by buyers.
Fact #5 – Over 600 Thousand New Residential Units Will Be Needed to House a 6.9 Million Population
Currently, there are about 1,342,155 completed residential units in Singapore. Based on the average household size of 3.53, these completed units cater to approximately 4,737,808 residents.
However this number is not entirely accurate yet as we have to discount the number of Work Permit Holders (Foreign Domestic Worker and Construction) who have their own accommodation. They add up to a combined total of 517,500.
As stated earlier, the current population of Singapore at Jul 2013 is 5,460,302. This suggests that in the current market, there is still a strong demand of approximately 204,994 residents in search for properties to rent or buy.
By 2030, a projected 6.9 million people will reside in Singapore and assuming that the average household size remains the same, 1,954,675 residential units will be needed to cater to the housing needs of the population.
By Marcus Sim of SG Property Reviews. Posted courtesy of www.Propwise.sg, a Singapore property blog dedicated to helping you understand the real estate market and make better decisions. Click here to get your free Property Beginner’s and Buyer’s Guide.
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