Singapore is known for its high cost of living, and property prices are no exception. For many Singaporeans, buying a property is a significant financial milestone. However, the question remains, how much do they need to work to afford a home? In this article, we will look at the average Singaporean’s working hours required to buy an apartment.
Estimated Сalculation
According to the Department of Statistics, the median monthly household income in Singapore is $9,189. The average price of a 4-room HDB flat in Singapore is around $400,000. To purchase a property at this price, a Singaporean would need to pay a 20% down payment of $80,000 and take a loan for the remaining $320,000.
Assuming an interest rate of 2%, a Singaporean would need to pay approximately $1,426 per month for 25 years to pay off the loan. This means that a Singaporean household would need to earn at least $4,753 per month to afford the monthly mortgage payments.
Based on the median monthly household income of $9,189, the average Singaporean would need to work approximately 69 hours per week to afford the monthly mortgage payments. This is based on a 40-hour workweek and assuming a monthly mortgage payment of 30% of the household income.
Other Expenses
However, this calculation does not take into account other expenses such as utilities, maintenance fees, and property taxes, which can add to the overall cost of owning a property. It’s important to consider these factors when determining whether you can afford to buy a property.
Moreover, the calculation also assumes that a Singaporean can afford to put down a 20% down payment. For many Singaporeans, saving up for the down payment can be a significant challenge, especially given the high cost of living.
Conclusion
In conclusion, buying a property in Singapore can be a significant financial investment that requires careful planning and consideration. The average Singaporean would need to work long hours to afford a property, and it’s essential to factor in all related expenses before making a decision. With the right financial planning and budgeting, however, owning a property in Singapore can be a realistic goal for many Singaporeans. You may be interested in Singapore Home Prices Continue to Surge Amid Strong Demand and Resilient Housing Market and The Expert Guide to Renting a Property in Singapore the Right Way.
