Buying A Property Amid The Economic Headwinds

The property market is still buoyant despite the economic challenges brought about by various factors, the foremost of which is the Russia-Ukraine war, which has caused our cost of living to rise significantly. Food and energy prices, in particular, have increased so significantly that we are today definitely “poorer” than we were a mere few months ago. Fortunately for us Singaporeans, the negative impact from Covid-19 is slowing declining as we open up our borders and move towards the new normal.

The question everyone is asking is, “Why are the demands for residential property and cars still buoyant as this scenario tends to go against the norm of people’s buying behaviour in the past?” The simple answer is, “Why not?” No one knows what the future holds for us, so if we can afford to buy the house or car we always dreamed about, and we can afford it, why wait? My own personal experience is a classic example of why procrastination is not always the best approach. I was planning to buy a car last year, and based on the advice of friends at that time that car prices would fall in the near future, I decided to wait. That same car is now totally unaffordable to me due to the ridiculously-high COE.

As far as the property market is concerned, the same argument applies. People who can afford to buy property at this point in time, and who subscribe to the thought-process that no one knows what would happen to property prices in future, are not afraid to take the plunge. Property upgraders are also enjoying higher prices when they sell their old properties, so it’s a simple equation of “Sell High and Buy High”.

The key consideration is Affordability. If you cannot really afford to take the plunge, or the purchase is going to put a strain on your current financial situation, it may be more prudent to wait until things are more settled. Otherwise, go for it. Now is as good a time as any to fulfil your dream.