From a real estate standpoint, there are numerous benefits to getting married young.

From a real estate standpoint, there are numerous benefits to getting married young.

Getting married sooner improves your chances of increasing your wealth through homeownership.

September 23, 2024

Given that population growth contributes to economic growth and vibrancy, Singapore needs more babies.

During the National Day Rally, Prime Minister Lawrence Wong announced that, among other things, employers will be required to double paternity leave from two weeks to four weeks starting on April 1, 2025, and parents of newborns will soon receive an additional ten weeks of shared government-funded leave.

The finance minister and prime minister, PM Wong, also stated that he hoped to announce in February of next year's budget that more assistance would be available to parents with three or more young children as well as those considering a third child.

Higher birth rates may be a result of more Singaporeans getting married younger.

The percentage of married men in their 20s among Singaporeans was 8.9% in 2023, compared to 13.5% in 2010 and 20.6% in 2000. In 2023, 2010, and 2000, the percentage of married female residents was 17.1%, 27.1%, and 40.2%, respectively.

The percentage of married men among residents in their 30s was 63.8%, 69.1%, and 72.8% in 2023, 2010, and 2000, respectively, while the percentage of married women was 70.1%, 74.8%, and 79.3% in the same years.

The trend towards later marriages was illustrated by Singapore, where the median age at first marriage for brides and grooms was 29.5 years in 2023 and 31 years in 2023, respectively, compared to 30.2 years for brides and 28.1 years for grooms in 2013.

Is it possible to encourage more Singaporeans to get married sooner? There are good reasons to marry young when it comes to real estate.

First, a young adult without children who wants to live on their own might have to rent a house. Before purchasing a new two-room flexi flat or any other type of flat, with the exception of 3Gen apartments, on the resale market, a Singaporean citizen must be at least 35 years old.

Rent is an outright expense, even though co-living in a well-designed, conveniently located space with good amenities can be enjoyable. Conversely, funds used to pay back a home loan contribute to the purchase of an asset whose value may increase.

Point of entry

Second, purchasing a new executive condominium (EC) home or a Build-To-Order HDB flat are the most affordable paths to homeownership in this area. A local couple must, among other things, reach the S$14,000 and S$16,000 monthly household income ceilings in order to purchase a BTO or a new EC home.

A person's income may increase rapidly between the ages of 20 and 40. A couple who marry later may surpass the income cap in order to purchase a new EC home or a BTO unit.

For males aged 25 to 29, 30 to 34, 35 to 39, and 40 to 44, the median monthly gross income from work, excluding employer Central Provident Fund contributions, was S$5,000, S$6,500, S$8,360, and S$9,870 in 2023, among degree holders who were full-time employed residents excluding full-time national servicemen. Among female degree holders, the corresponding numbers were S$4,667, S$5,850, S$6,900, and S$7,583, in that order.

The prices of BTO apartments are subsidised. A comparable resale unit nearby with a shorter remaining land lease may cost 30 to 40 percent more than a four-room BTO unit. Furthermore, compared to a peer who purchases a home when they are older and have higher incomes, an eligible young first-time homebuyer can receive larger housing grants for new or resale HDB homes when their income is lower.

The EC is a combination of private and public housing. Private developers build and sell ECs, which usually have condominium features and are situated on land with a 99-year leasehold. Similar to a private condominium, the EC unit can be sold to anybody, including foreigners, after ten years. A similar new condominium unit may cost 25% more than a new EC home.

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Recycling benefits

Third, the proceeds from the sale of a new EC or BTO property can be utilised to purchase a higher-value home and increase one's wealth through homeownership.

HDB will begin classifying projects into Standard, Plus, and Prime categories with the next BTO exercise in October. The Greater Southern Waterfront is one of the most desirable central locations for prime apartments. Additionally, apartments will be located in developed estates and strategic areas within each region. The Minimum Occupation Period (MOP) for a BTO unit classified as Plus or Prime is 10 years, while the MOP for a Standard flat is 5 years.

When a person takes out a home loan from a financial institution and has no outstanding housing loans, they are subject to the 75% loan-to-value limit (LTV). Nevertheless, among other things, if the loan period lasts past the borrower's 65th birthday, a reduced LTV is applicable.

In summary, when a couple reaches the MOP for a BTO unit as they get older, it may have an impact on their ability to borrow money to purchase a private residence.

Fourth, a couple may achieve financial independence sooner if they buy a home when they are young.

If everything else is equal, a couple who married in their 20s and used a 25-year housing loan to purchase a home will be mortgage-free sooner than a couple who took out a loan when they were married in their late 30s. Because they own a fully paid-up home, a couple who got married in their 20s may have more freedom to retire when they are just over 50.

Furthermore, the requirement to service a housing loan may help many young couples by making them more frugal with their discretionary spending.

Spending more time in higher education or concentrating on advancing their careers may be the reasons why people are getting married later in life. Additionally, you cannot rush the process of finding a compatible life partner. Assets, including a home, may be divided in a messy and expensive manner following a divorce.

However, it would be prudent for young Singaporeans to concentrate their hearts and minds on getting married as soon as possible. After all, starting early probably increases one's wealth from homeownership.