One reason was that prices are considerably cheaper than Hong Kong and Shanghai.
The number of purchases by foreigners that are Non-Permanent Residents (NPR) rose by 44.7% to 1,549 homes in 2017, accounting for about 7.1% of total home sales, Edmund Tie & Company revealed.
ET&Co research senior director Lee Nai Jia noted that with Singapore’s private residential market bottoming out, more investors are drawn to the market. “Additionally, private residential prices are considerably cheaper as compared to other gateway cities such as Hong Kong and Shanghai. Most of the NPRs purchased homes in the prime districts or close to the CBD. For instance, Sophia Hills and Gramercy Park situated at Districts 9 and 10 sold 57 and 48 units respectively to NPRs.”
The number of home purchases by Singapore Permanent Residents (SPR) also increased in 2017, by about 28.6% to 3,765 units. “Unlike the NPRs, SPRs seek projects that are outside the central region and in upcoming districts. These projects include Parc Riviera at West Coast Vale, Grandeur Park Residences at Tanah Merah and Symphony Suites at Yishun,” Lee added.
Mainland Chinese buyers comprised 6.7% of total private home purchases in 2017, after rising by nearly 32% from 1,186 units purchased in 2016. Of the 1,564 units purchased by Mainland Chinese buyers, some 1,074 units were purchased by SPRs. Notwithstanding, the number of units purchased by Mainland Chinese who are NPRs also rose by 30.3% from 376 units in 2016.
Remarkably, foreign purchases have extended to the fringes of the prime districts and the CBD. Mainland Chinese buyers were active in Districts 3, 15 and 19 whilst the prime districts are not in the top five popular districts purchased by the Malaysians.
Lee commented, “Notwithstanding, we anticipate the number of purchases in Districts 9 and 10 to increase with more upcoming launches. The restraining effect of the Additional Buyer’s Stamp Duty (ABSD) on demand has reduced due to optimistic property outlook and the implementation of similar duties and borrowing constraints in other foreign markets.”
ET&Co noted that whilst there was an increase in the number of foreign buyers, the number of residential property purchases by Indonesians fell by 10.4% to 345 units. “Given that most Indonesian buyers have already invested in Singapore, the demand is more subdued unless there are significant pull factors for them to enter the market.”
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