If you’re new in the homebuying process, people may have asked you if you’re looking for a ‘forever home’ or a ‘starter home’. This is because, in the old days when our great grandparents or grandparents buy a home (or build one), they usually stay put, plant roots and settle down like they’ve discovered oil or something.
A forever home is one that you plan to stay in for the rest of your life. It’s a home you have no plans to ever move out of or sell, not even if the property value appreciates and you stand to make a huge profit.
Here are some reasons why people may choose to make a property their forever home:
- They are satisfied with the size and foresee that it can still meet their needs in the future
- They love the location and surrounding amenities and don’t see themselves ever living elsewhere
- They want their children to grow up there, perhaps because of nearby schools or family-friendly amenities
- They don’t want to go through the tedious process of buying another home in the future
- They don’t want to go through the hassle of uprooting their family and moving to another place some years down the road
Meanwhile, a starter home is a home purchased by first-time homebuyers with the intention of buying another home at a later date when their particular needs change. People typically stay in their starter homes for a few years up to a decade before moving out. Here are some reasons why people may choose to buy a starter home:
- The starter home fits within their current budget but is not where they envision themselves in the long-term
- The resale value is expected to increase over time, which can help to finance the purchase of their next home
- They plan to upgrade to a bigger home some years down the road to accommodate lifestyle changes, such as a growing family
These days, many millennial or younger property buyers aren’t looking for a forever home. Even if they purchase a property with the intention to make it their forever home, they may end up selling it away due to how much they can earn when the time is right. Others opt for starter homes with the intention to sell and upgrade, hoping to eventually buy a larger home in a particular neighbourhood and dub it their forever home.
In this feature story, we speak to young homebuyers of different ages (with some names changed upon request) who have bought homes, or who are planning to buy homes, to see if they believe in purchasing forever homes.
Rachel (age 22)
Rachel and her boyfriend are graduating from university in a few months’ time and are planning to purchase a resale HDB flat as soon as they are financially capable.
Although the costs are likely to be higher for a resale flat compared to a BTO flat, they are willing to bear them to be able to move in earlier as they have plans to get married and start a family in 2 to 3 years’ time. Rachel explained that since the BTO balloting process might take a few years and BTO construction takes another 4-5 years, it was not a suitable option for them.
However, the young couple does not plan on the resale flat being their forever home. They hope to upgrade to an EC, after staying for the 5-year minimum occupation period (MOP) and eventually upgrade to a penthouse one day.
Michelle (age 23)
For Michelle, who graduated from university last year and is working full-time, there’s no such thing as a forever home, unless maybe if it’s a bungalow.
Michelle and her boyfriend of 1 year are planning to apply for a 5-room flat at one of the upcoming Tengah BTO projects which are launching this month. Tengah is their top choice in terms of location because it is relatively close to where both of their parents live, which will allow them to easily have dinner at their parents’ places even after they move out.
Since they plan to get married and have children eventually, Michelle wants to live close to her parents and parents-in-law so they can help with the care of the children.
Another reason why they chose Tengah is that it is relatively close to several potential future workplaces for them both. If their ballot is successful, Michelle foresees them staying at Tengah for about 10 years before upgrading to a bigger home. When asked if she has an end goal for her home, Michelle says the plan is to keep upgrading as long as they have the means. She hopes to one day upgrade to a bungalow, if possible.
Vanessa (age 29)
Vanessa and her husband, who have a six-month-old son, are currently waiting for their 5-room BTO flat at Tampines GreenCourt to complete construction at the end of this year.
They chose this flat in Tampines because of its proximity to the MRT and to Vanessa’s parents-in-law.
However, Vanessa says that this 5-room HDB flat at Tampines is unlikely to be their forever home. As she hopes to have another child in the future, she feels that the flat may become too small as “children need space to run around”.
Their current plan is to stay at the flat for the 5-year MOP before hunting for their next home, if necessary. At the moment, Vanessa and her husband are keeping their options by being mindful not to pump too much money into their BTO renovations.
Vanessa’s priority is to ensure that her family doesn’t outgrow the space. In a few years’ time, if their family size increases, Vanessa says they may consider upgrading to a bigger 5-room resale flat.
Audrey (late 30s)
Audrey and her husband are newly-weds in their late 30s who recently purchased a unit in Parc Canberra EC. They chose this location because of the many amenities in the area and because it is within the vicinity of where her parents-in-law live.
However, this EC is just a starter home for them. It is too small for their liking, so she and her husband are keen to upgrade to a bigger home after the 5-year MOP if finances permit. When asked what they will look for in their next home, Audrey says that it will depend on the options available in the housing market and their preferences at that time. Their end goal is to eventually upgrade to landed property.
Audrey doesn’t buy into the idea of a forever home because she believes that “needs change over time” and so, a new home may be necessary to accommodate changing needs and to ensure comfort as time passes.
From these interviews, it seems that many young homebuyers in Singapore do not believe in buying forever homes. They prefer starter homes that allow them to upgrade to a new property as their needs change or as their finances grow.
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Do you think the concept of ‘forever home’ still applies today? Let us know your opinion in the comments section below or on our Facebook post.
If you found this article helpful, 99.co recommends checking out 5 unexpected mistakes homebuyers usually make when buying an HDB flat and How to get enough money to buy a property in Singapore?
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