What factors influence Millennials home buying decision?

by - Thursday, November 02, 2017

Depending on your perspective, the Millennial generation – those born after 1980 – either has it very good or not at all. On one hand, they’ve grown up during a relatively affluent period in Singapore’s history. On the other hand, the boom years of 2006, 2007 and 2010 meant soaring property prices across the board, reaching a peak in 2013. This left Millennials – many of whom were in the early stages of their careers – without a strong foothold on the property ladder. That said, having a roof over one’s head is a basic necessity. Without proper planning, Millennial would be left stranded in today’s world. Despite having new BTO being launched in the market, not many could afford to acquire them.

WHAT FACTORS INFLUENCE MILLENIALS HOME BUYING DECISION? 


Location
Location of the HDB BTO is one of the more important factors to be considered by home buyers. By purchasing a property that’s located centrally, this could ease one from travelling for their work daily, for example. Having the flexibility to take the MRT and being close to one is very helpful as the parking fees and ERP would be rather significant. 
Most younger Singaporeans are complaining that the newer HDB BTO are not located close to central areas. They do not want to travel long hours and be inconvenienced by the travel. Proximity to the MRT is what convinced most people to put down roots where the development is also close to markets and schools, important criteria for newlyweds looking to start a family.
Location is also paramount for young families looking to enroll their children in desirable schools. These buyers are more willing to invest in pricier resale HDB flats rather than BTOs due to that reason. They also tend to view their purchases as long-term investments, compared to BTO buyers, who tend to upgrade their homes after the MOP (Minimum Occupation Period). Having a property located close to desirable schools would remove the hassle of sending and picking up their children after school. 

Size/Quality of Living Space
Size of a living space matters. It might not need to have 4 to 5 rooms for one to be happy but having the right amount of space in the property would improve the quality of living spaces. With the current trends, BTOs are getting smaller and smaller compared to what it used to be. Some rooms could barely fit a Queen size mattress. In order to overcome such problems, some people have resorted to combining the master room with another bedroom to form a spacious master suite, or converted one of the bedrooms into a walk-in wardrobe. 
The desire for spacious property would drive many people to purchase larger HDB resale flats from the market. Some of the older design have more spaces and better views compared to the newer launched BTOs being built at the current moment.
Other than spaciousness, Millennial buyers are also influenced by efficient layouts. The couple who bought the Lake Grande unit – an 818 sq. ft., two-bedroom-plus-study apartment – were attracted to its squarish/regular layout. Most two-bedders on the market are open-plan, but this unit had an enclosed kitchen that could contain cooking fumes. This was important as the couple enjoys cooking.

Price
Millennial buyers are price sensitive. People tend to be interested to purchase something below the market value in order to make themselves feel good that they have secured a good deal in today’s challenging economic condition. However, most younger Singaporeans feels that the current property market in Singapore is rather expensive. They would prefer to continue renting the property instead of paying the huge price tag associated with ownership of a property. The ideal option would be getting a property in an up and coming area instead of somewhere central or trendy as it would definitely jack up the price tag of the property. 
Those who can afford to do so will rent out these apartments for a year or two. They will then return to the unit, renovate it, and use it for their own stay. 

Proximity to Family
Whether it’s for practical or emotional reasons, Millennial buyers look for homes that are close to their families. It would be convenient for them to meet up with their families during the weekends or during festive seasons. In year 2013, Singapore government has launched a multi-generational (or 3Gen) flat. These 3Gen flats are open to any married couple, living with at least one parent. 3Gen flats are five-room flats that allows the younger generation to stay with the parent.

Lifestyle
Whether you’re a shopaholic, cafe connoisseur, fitness enthusiast or nature lover, there’s bound to be an estate or development that speaks to you. This is why some people choose to purchase their property closer to town areas or entertainment hubs in order for them to enjoy their lifestyle to the fullest extent.
Being located close to such environment would also contribute a better lifestyle from the buyers. They could easily indulge in their entertainment or way of life without having the hassle to travel or arrange for it, be it private condominium, new launch BTOs or resale HDB. It’s up to their lifestyle preference that decide the type of property they decided to commit.

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