5 Interesting Singapore Property Market Trends That Will Impact Future Buyers Beyond 2024

If it’s been a while since you’ve bought a home, and you’re upgrading or moving today, you may be in for a few surprises. The property development landscape has changed more over the past decade than in the past 30-odd years. Starting sometime in the ‘00s, factors ranging from developer stamp duties to development charges and proptech, have all shaped new property market trends in condo development – and not all homebuyers may agree these are improvements. Here’s what you can expect these days:

What has changed in the property development scene? 

Developers in the past didn’t have the constraints they have today. There was no ABSD, timeline to sell, and margins were higher. Rules were also less sophisticated, so certain rulings like planters and bay windows changed how certain developments were built.

Today, developers pay 40 per cent ABSD on the land price of a project if they can’t complete and sell it within five years (it has now been relaxed a little). Coupled with higher land prices and Land Betterment Charges (LBCs), this leaves developers with little room for error – and hence also little room for novelty and experimentation. This is partly behind the use of prefabricated construction methods (PPVC), and a frankly formulaic approach: most condos in the past decade quite closely resemble one another. 

On top of this, government bodies like BCA now rate developers and builders into different tiers, and buildings are also judged on other factors like ease of downstream maintenance, and ecological friendliness. All this scrutiny does have a positive effect on quality; but when coupled with the tight time frame, it’s sometimes a further disincentive for risk-taking when margins are lower today too. 

As such, it is a very different market at this point. While almost anyone could be a developer back then and survive, the current market of lower margins, and tight timelines to sell means that to succeed in this environment you need to be right on the money with your product. This means that developers have to make sure that they develop the right product that appeals to customers yet still be able to carve out profits for themselves.

So the hard product has come a long way. From the space being more efficient, to the facilities and outlook being able to stand out.

Rules around the development have also evolved for the better, with the harmonization of GFA benefitting consumers so things like air space as well as reduced wastage of air-con ledges means that you are paying exactly what you get for.

Here are some of the trends that we are seeing today.

Current trends we’re seeing in property development

1. Greater space is given over to common facilities

One example of this would be Parc Clematis, which has 400,000 sq. ft. given over to shared facilities alone. Normanton Park, also a mega-development like Parc Clematis, has similarly dedicated 60 per cent of its sizeable 661,000 sq. ft. to common grounds and facilities. 

These days, developers like to highlight a huge number of facilities, sometimes numbering them in the hundreds in marketing materials. This is kind of a problem too, however, with some buyers now noticing that the claims are rather stretched (e.g., laying a few rocks in a sand pit might be called a zen garden “facility,” or attaching one slide to a part of the wading pool may be marketed as an aquatic playground). 

But exaggerations aside, developers do seem to be more focused on ever-more lavish facilities, and in larger numbers. This can be a plus, or a downside depending on who you ask: some home buyers, for instance, would rather less space be given over to facilities, and more space be given over to bigger units. 

Nevertheless, we can see that some facilities in condos have been very well utilised, especially those that have a dining/entertainment element. As homes get smaller, these places become important for residents to be able to invite family/friends over.

But there’s also an argument to be made that, with such a huge number of facilities, maintenance over the long term is bound to be more expensive or require greater care in maintaining it well. This does depend on the property manager’s skills at procuring lower-cost services though, and in bigger projects, the larger number of units may help to keep costs manageable (which may also be another factor driving the preference for bigger condos). 

2. A growing preference for larger projects

Bigger projects tend to have cheaper units, due to simple economies of scale; and a bigger number of units sharing maintenance costs could allow for more extensive facilities. 

Also note that, strictly in terms of marketing, big condo projects tend to be coupled with bigger marketing spend by developers – they have a five-year time limit to move all those units, so advertising tends to be more aggressive from the start. This is a big plus for property agents, who face less of an uphill battle to sell. If the developer has already spent millions to plaster the condo’s name everywhere, the agents may not need to shoulder as much of the costs to spread awareness. We’ve spoken about this more last week, which you can read here.

In any case, this is gradually creating a preference for at least mid-sized condo units, of 500 to 600 units. These projects have the land area to accommodate more facilities and are just much easier to sell than small and boutique projects, such as those with just 100 or 50 units. 

That said, some property investors (i.e., not pure homeowners) may not be too happy with projects that get bigger than that. 

For huge condos with 1,000+ units, there’s a fear of competition for tenants or resale buyers later. So while owner-occupiers may like such huge developments, some investors may still prefer mid-sized condos – but investors are the smaller group of buyers. 

And while developers sense the preference toward “going big,” there is some natural resistance: big land plots are pricier, attract higher ABSD, and hence signify higher risks. Regardless of the condo’s size, developers still only have five years to complete and sell the units.

3. Tighter controls over the tenant mix, for mixed-use condos 

In the past, developments that comprised both commercial and residential components were very different from what you see today. For example, older projects like People’s Park Complex, which ended up with mainly massage parlours and tour agencies downstairs, or projects with commercial spaces that were haphazardly sold to anyone. This resulted in scrambled merchandise stores, or niche services that tenants were unlikely to ever use.

Simply put, in the past, developers seldom cared who the future commercial tenants were; their job was just to build, sell, and say goodbye. 

These days, developers often promise to control and optimise the tenant mix, to make the condo more of a draw. Developments like Woodleigh Residences, Pasir Ris 8, and J’den, all pack proper shopping and dining experiences. And to demonstrate how serious this can get, consider the situation at KAP Residences, where owners considered legal recourse when promised tenants didn’t turn up. 

One of the selling points at Sceneca Residence was the developer promising a supermarket; and even so, buyers only trusted this because they inspected the developer’s former work with The Poiz (also a mixed-use project). 

This has resulted in residential developers behaving almost like commercial developers in some sense when taking on mixed-use or integrated projects. While this can and has resulted in higher costs, some buyers may consider it a worthwhile tradeoff.

4. Dumb-bell layouts, and other moves toward space efficiency

Thanks to the harmonisation of Gross Floor Area (GFA) definitions, developers can no longer game the system, and squeeze out extra earnings from oversized air-con ledges, bay windows, planter boxes, and other such inefficient features. This does mean more actual living space, and most buyers consider it a net positive. 

Now there is a concern that developers may raise prices anyway, to make up for the loss of these tricks; some of our more cynical realtors and analysts seem convinced of it. In any case, pricing is sensitive and is always subject to demand and supply forces.

The issue here is that some homeowners may have liked some of those “inefficient” features. Every now and then, for example, we meet buyers who actually want planter boxes because they like gardening. There’s also the issue of balcony sizes: it’s a matter of debate whether or not a balcony is a waste of space. Some homeowners see it as a desirable luxury, whilst others see it as a pointless waste of living room space.

The desire for efficient layouts has also led to configurations like the dumbbell, where the living room acts as the connecting space between bedrooms. This mitigates the need for corridors, although some homeowners decry the loss of privacy (it can mean the main door opens right into the living room). 

Likewise, efficiency today is often associated with open kitchens; this has even become the default in HDB layouts. But we know some old-school home owners, and serious home cooks, absolutely loathe open kitchen designs. 

The upside is that today’s more open plans are also more versatile, so if you want an old-school layout, it shouldn’t be hard to put in some partitions. Adding walls is easier than knocking them down, as some load-bearing walls can’t be moved.

5. Focus on multiple train line access

For those of you who were in the property market in the ‘70s and ‘80s, you may remember when having the bus stop right outside your condo was a big draw. The same fate seems likely to befall MRT stations: with new stations popping up like mushrooms in Mandai, we may soon find that almost every condo has a station within walking distance.

What’s starting to matter more than an MRT station is having multiple train lines near the condo. This means stops like Paya Lebar, Outram, Serangoon, etc. have more value than train stops on a single line; and some developers tend to angle for this when picking out land plots. 

(Except for some very high-end or boutique condos mind you, as it’s expected that in such properties, the buyers can afford to drive). 

You may also find pricing is more affected by this, as a condo near a single-line stop may be considered less desirable. This also depends on the nature of the line though, as some lines – such as the East West Line or North South Line – may be considered more valuable than the Thomson – East Coast Line or Circle Line. 

So what other changes or trends can we expect in the future? If there’s any that you feel we’ve missed out on, do leave a comment below. And to get an in-depth look at the more recent condos, or perhaps even an older resale one, follow us on Stacked. We’ll give you detailed data and information on the Singapore property market.