If you have visited a show flat in recent years, you may have noticed that the unit sizes seem to have reduced. This is not surprising, as our perception of space is relative to what we are accustomed to. The homes we grew up in, whether HDBs or condos, were typically larger in the 1990s and 2000s. For example, in 1995, the average size of a new condo was 1,272 sq ft, and by 2005, it had increased to 1,286 sq ft. However, in 2015, the average size had decreased to 858 sq ft, and by 2024, it had reached 929 sq ft. This is mainly due to the changing demographics during these years. In 1995, the average household size was four, but it has gradually decreased to 3.1 by 2024.
On an individual basis, each person had an average space of 318 sq ft in 1995, which increased to 357 sq ft in 2005. However, it dropped to 252 sq ft in 2015 and then rebounded to 300 sq ft in 2024, an increase of 19%. Over the past 29 years, the average size of condos has decreased by 5.7%, which is impressive considering the limited land in Singapore. The government’s intervention has played a significant role in achieving this. In 2008, several condo projects in the Rest of Central Region (RCR) introduced “Mickey Mouse” units, with sizes as small as 24 sq m (258 sq ft), equivalent to two parking spaces. This made it easier for people to invest in properties, with the entry level reduced to as low as $375,000. These smaller units were in high demand, leading to many more “Mickey Mouse” units being built in the following years. However, there were concerns about the impact on the quality of living in the long run.
To address these concerns, the Urban Redevelopment Authority (URA) introduced guidelines in 2011, setting a limit on the number of dwelling units (DUs) allowed in a project. The average size of 70 sq m was used to determine the maximum number of DUs in areas outside the Central Area. In some areas like Telok Kurau, Kovan, Joo Chiat, and Jalan Eunos, the average size was even more stringent at 100 sq m. This was made effective in January 2012.
However, over the next few years, the average size of DUs continued to decrease, leading to an increase in the number of DUs and straining the infrastructure in certain areas. To address this, the URA further tightened the guidelines in January 2019, resulting in an increase in the average DU size outside the Central Area by 21.4% to 85 sq m. Additionally, more areas were required to meet the more stringent requirement of 100 sq m, including Marine Parade, Balestier, Stevens-Chancery, Pasir Panjang, Kovan-How San, Shelford, and Loyang. This helped stabilize the average DU size outside the Central Area in 2024 at 935 sq ft, an 18.8% increase from 2019’s 787 sq ft.
However, one downside of the guidelines was that smaller units were now being built in the Central Area, which was not in line with the URA’s goal of making it an attractive place to live, work, and play. This led to the guidelines being extended to the Central Area in January 2023, requiring at least 20% of the DUs in a project to have a net internal area of at least 70 sq m.
To sum up, opting to invest in a condo in Singapore offers a plethora of benefits, such as a high demand in the market, the potential for significant appreciation of the property, and attractive rental yields. However, it is crucial to take into careful consideration various factors, including the location, financing options, government regulations, and the current market conditions. To make well-informed decisions and maximize returns in the dynamic real estate market of Singapore, it is advisable to conduct extensive research and seek professional advice. Whether you are a local investor aiming to diversify your portfolio or a foreign buyer in search of a stable and profitable investment, the condos in Singapore present a compelling opportunity. Additionally, staying updated with New Condo Launches can be advantageous in staying ahead in the market.
In June 2023, the URA further harmonized the strata area and gross floor area (GFA) definition. This meant that areas like air-conditioning ledges, if exclusive to a unit, would be counted as part of its strata area. As a result, many developers have chosen to omit aircon ledges, leading to a decrease in average DU size by an average of 6%.
Across different market segments, the Rest of Central Region (RCR) saw the most significant increase in average DU size by 19.5% to 944 sq ft since 2015. This was likely due to the stricter control on average DU size in the RCR. In contrast, the average DU size in the Central Region (OCR) improved by 5.8%, reaching 898 sq ft in 2024 from 2015’s 858 sq ft. However, the Central Core Region (CCR) saw a decrease of 11.7%, with the average DU size dropping to 1,092 sq ft in 2024 from 1,236 sq ft in 2015.
It may take some time before the impact of the guidelines on average DU size in the Central Area is felt. However, it is unlikely that the average DU size will go back to 2015’s level. This is because the local buyers make up around 75% of the buyers in the CCR, and they tend to prefer compact units. Developers, on the other hand, have had to reconfigure the design and layout of units to avoid paying Additional Buyer’s Stamp Duty due to unsold units.
Overall, thanks to the URA’s intervention, the average size of DUs has increased, with buyers receiving better value for their purchase today compared to 10 years ago. However, with the recent harmonization of GFA definition, there may be a downward trend in average DU size.