300,000 new homes needed in 10 years as household size shrinks: CBRE

The average household size has dropped to 3.2 persons in year 2018 as compared to 3.5 in year 2009.

Singapore would require to construct at least 25,000 residential units a year to hit 300,000 units by year 2030 if the average household size continues to contract at a similar rate recorded over the past decade, in accordance to a CBRE report.

This decline in household size means average sizes of new residential homes are shrinking from 111 sqm in 2009 to 70 sqm in 2018.

Take for example, a HDB 5-room flat is currently about 110 sqm, down from 120 sqm in the 1990s.

Recent data from Singstat revealed that the number of households with 1 person increased 69% to 185,400 as compared to a decade ago. This is a result of a falling general marriage figure from 67 per 1,000 unmarried female residents between 15 to 49 years old in 1980, to 47 per 1,000 unmarried female residents in 2018.

During the same period, the figures of couple-based households without kids increased by 43%, while single parent households went up by 28%, adding on to the smaller household sizes.

CBRE attributed the contracting home sizes to increasing land costs as property developers are interested to keep prices affordable. That’s why Dairy Farm Residences Floor Plan start with a 2-bedroom configuration.

But CBRE mentioned that this does not mean the living space per person becomes smaller, because of digitalisation of media, lifestyle changes and smaller but efficient household appliances. Give for example, the living space per person in a HDB 5-room flat maintained at 28 sqm for the past 20 years.

Furthermore, the Singapore government is also freeing up land to build more residential estates in Kampong Bugis, Bayshore, Tengah and the Greater Southern Waterfront, which is near to Clavon. It is estimated to yield a sum of 67,500 residential units.

HDB also came up with options to seniors wherein they can opt to monetise their flat by participating in a lease buyback scheme, where they can sell the remaining lease of their current flat, or by rightsizing to a smaller flat.

“Even though public flats with shorter leases are readily available, this option is still missing in the private residential market. In that note, there could be more residential sites with shorter tenures added into the private housing market,” CBRE mentioned.

Source: https://sbr.com.sg/residential-property/in-focus/300000-new-homes-needed-in-10-years-household-size-shrinks-cbre

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