Demand for Singapore property by foreigners on the rise

By Michael Lim / The Edge Property | December 2, 2016 9:25 AM SGT
Foreigners have started snapping up private residential properties here in greater numbers compared with a year ago, according to a report by property consultancy JLL. Leading the charge are buyers from China, followed by Indonesians, Malaysians and Americans.
According to JLL, there were 782 transactions made by foreigners in the first nine months of this year, an 11.7% rise from a year ago. The figure excludes permanent residents. Chinese buyers were the most active, accounting for 29.4% of all foreign purchases from January to September. The Indonesians were a distant second, accounting for 14.6%.
Chinese buyers have overtaken Indonesians as the top foreign buyers of private homes in Singapore since 2010. This can be attributed to the wealth growth of the Chinese and their increasing familiarity with the Singapore residential market.
Malaysians accounted for 10.5% of foreign transactions, and the Americans were at 7.3%. JLL noted the growing prominence of American buyers. This is a significant increase in proportion, relative to the 1.1% in 2011. US nationals are exempted from Additional Buyer’s Stamp Duties under the Free Trade Agreement, which may have contributed to the rise in the number of purchases.
JLL also reports that Indonesians have higher budgets among foreign buyers, with most of their deals falling within the $3 million range. It notes that Indonesians have a strong preference for pricier properties above $1,400 psf and located in the Core Central Region (CCR).
The Chinese and Malaysian buyers are more budget conscious as a higher proportion of the properties they picked up were priced below $1.5 million and within the $750 to $1,700 psf range. However, in terms of geographic preference, the Chinese are more active in the Outside Central Region market while the Malaysians are more active in the CCR market.
JLL expects the recovery in foreign demand seen this year to continue into next year, and homes in the CCR to remain the preferred choice of foreigners.