Why renting a home is not just a ‘waste of money’
THERE is a common understanding that renting a home is a waste of money. After all, the easiest way to make bank is to find a good partner, get married, buy a Housing and Development Board Build-To-Order (HDB BTO) flat, move in, and then later sell your flat for a tidy profit.
Rental is seen as the opposite of that. It is a money pit that does not provide any return on investment because it is purely an expense.
As someone who does not have any near-term plans to get married (sorry, mum), I have been thinking about when I will finally be able to move out.
My partner and I have both felt the pressure from our peers, specifically those who entered relationships in school and applied for BTO flats even before they graduated, sometimes with help from their parents.
These sweet couples will get the keys to their homes three to five years after graduation, which is a good interval to have also saved for and held a nice wedding along the way.
However, many of us probably have not followed such an ideal life path.
Some of us may be seeking out or finding our way in relationships long after we have graduated. Until we decide that marriage is well and truly on the cards, it is almost impossible to own public housing.
Instead, the solution to gaining our own space would be to rent.
Still, HDB rental prices, as with the entire housing market, have been running hot lately.
According to the SRX Rental Index, HDB rents surged 20.9 per cent for the first nine months of this year. HDB data showed median rents for a three-room flat ranging from S$2,000 per month in Bukit Batok to S$2,750 in Punggol.
Aside from singles looking for their own space, couples who are waiting for their BTO flats and do not qualify for the Parenthood Provisional Housing Scheme will also be looking for rental homes.
In addition, a recent property cooling measure requiring private property owners to serve a 15-month wait-out period before they can purchase a resale flat will likely drive further demand in rental flats.
Even ignoring the rising prices, why should anyone spend money on space that they already have with their parents or families?
Of course, that assumes that space at home with your parents is conducive.
In 2021, police reports on family violence rose to 5,190, from 5,134 in 2020, said the police on Oct 31. Most of such cases of violence were allegedly committed on spouses, followed by parents and then children.
“Post-circuit breaker, we see a lot more families coming forward to say, ‘I want to apply for a personal protection order, I want to move out’,” principal social worker at Care Corner Project StART Kristine Lam told reporters at a media briefing then.
Altercations do not even need to rise to the level of violence for a living space to be inhospitable.
As more people are able to work from home, friction can be exacerbated as family members spend more time together.
A colleague recently said that she moved out because her sibling’s children would invade her space whenever they came over to be taken care of, even while she was working from home. Despite her best efforts to work through the issues with her family, the issue persisted.
To gain some semblance of peace, she and her partner moved into a one-bedroom apartment for S$2,400 per month. For her, the benefits to her mental health and the de-escalation in family tension were worth the price.
Aside from leaving difficult family environments, one can also gain different life skills from moving out.
When I had the privilege of staying abroad on exchange, I learnt to cook simple stir-fry dishes so that I wouldn’t have to eat instant noodles daily. That sense of responsibility came quite naturally once I stopped having my parents fuss over me.
In that way, moving out into a rental home could be seen as an investment into our own mental wellbeing and personal development.
Even if our homes are conducive to live in, are we then robbing our parents of potential retirement income from rentals when we stay under their roof?
According to an Answers.sg survey as at Nov 2, the median percentage salary given by all Singaporeans to their parents is 10 per cent, while the median amount given was S$500. That is not nearly enough to cover the “rental” of our own rooms, let alone the groceries and utility bills that many parents continue to pay for us.
While I am not suggesting that all of us start paying rent to our parents, there is a cost to our housing decisions whichever way we decide. How we decide to compensate our families through tangible or intangible means is something we should discuss with them at some point.
Of course, affordability is something that needs to be properly considered. A common rule of thumb is for people to spend no more than 30-40 per cent of their income on rent, which would make it a luxury for many at current market rates.
Yet, merely saying that “rental is a waste of money” unhelpfully disregards many other intangibles that we ought not to take for granted.
