Analyzing the Impact: How Will Singapore's Population Growth Affect the Property Market?

Figures published show that for the first time, Singapore’s total population has exceeded six million, mainly due to the growth in the non-resident population. 

As of June this year, the country’s population stood at 6.04 million, a 2 per cent increase from last year. 

Though this trend has been pre-empted since the release of a Population White Paper in 2013, there will still be questions on how big a population is sufficient for Singapore to maintain its economic competitiveness moving forward.

As a real estate professional, my interest lies in whether our small island's current housing supply can meet this gradually increasing population number.

I have put together some of these numbers and coupled with realistic assumptions, derived possible situations of the housing market in Singapore in the years ahead.

1. Population Growth:

Considering the past decade's growth rate across different residents segment, the average growth rate was applied to project the total population numbers till 2030.

With these growth assumptions, Singapore's total population will be at 6.43mil, which will be at the lower end of the 6.5mil to 6.9mil projection in the Population White Paper.

1. Total Residential Dwelling Units and New Supply:

The next data points that we will be keen to explore are

1. How does the current population to dwelling unit ratio look like?

   Taking into account all the various housing available from HDB, Condos and Landed Properties, the number of residents in each available dwelling unit has decrease from 4.3 people in 2014 to 3.78 people in 2024.

   
   

   This meant that in the past decade, there has been 25% increase in housing while population only grew by 10%.

   
   

   Interestingly, despite the fact that housing supply has increased at a much faster rate than population growth, we are still seeing both private property prices as well as HDB prices seeing major gains in the past years.

   
   

2. With assumed population growth to close to 6.5million by 2030, is the supply of new housing enough to meet the increased population?

   Putting together some of the publicly available data about upcoming private residential properties and using averages as an estimation of future HDB supply, there is reason to believe that housing supply will be built at a much faster pace than population growth till 2030.

   
   

   This is a good sign as it shows that the Government is indeed looking hard at the assumptions and trying to prepare for future demand.

   
   

   The residents per dwelling unit can possibly fall to 3.61 by 2030, pointing to further supply and demand gap.

1. Potential supply crunch for aspiring new Private Property Owners

A side observation from the data derived above shows that there is an expected drop of completed condos and EC in 2025. This might lead to an upward price pressure for private property prices moving into 2025.

Looking into the next 5 to 6 years, there is also a possibility that the uptrend in prices will continue as the average supply of newly built condos will be 10% lesser than previous years.

In summary, as we looked into the impact of population growth on the property market in Singapore, we can conclude on a few facts:

1. Singapore's population is on track to hit the 6.5mil - 6.9mil range as discussed in the Population White Paper.

2. Housing supply grew at close to double of population growth rate between 2014 and 2024. But property prices still climbed, signaling that supply and demand is not the only factor that contributed to price movement.

3. Bonus finding: With the decreasing average number of completed private property from 2025 to 2030, coupled with an increasing population, we can expect property prices to move further up in the years ahead.