Non-landed private property in Singapore continued to experience strong demand and rising prices in Q3 2022, after a strong showing in Q2 2022, according to data from the PropertyGuru Singapore Property Market Report Q3 2022.
Despite the new cooling measures implemented in December 2021, URA data for Q2 2022 revealed that prices of non-landed private residential properties increased 3.6% quarter-on-quarter (QoQ).
Notably, prices of non-landed properties in the Core Central Region (CCR) rose by 1.9% from Q1 2022 to Q2 2022, after a 0.1% decrease was observed from Q4 2021 to Q1 2022. Similarly, prices of non-landed properties in the Rest of Central Region (RCR) grew 6.4% QoQ, bouncing back from the 2.7% QoQ decline in the previous quarter.
Part of the reason for this resurgence could be because more foreign investors are turning their interest toward the Singapore property market. Typically, these investor darlings buy property in the CCR, close to the Central Business District (CBD), and luxury properties, with the wealthiest buying units in bulk. For instance, a Chinese national recently snapped up 20 units at Canninghill Piers for $85 million.
So, where are the condos favoured by foreign purchasers located? Let’s find out.
Number of Non-landed Private Properties Bought by Foreigners in Singapore (Q2 2022)
According to URA transaction data, 291 non-landed private property transactions were made by foreigners in Q2 2022, a marked increase from the 143 units that were moved in Q1 2022. This translates to a 103.5% quarter-on-quarter increase.
This quarter, 74 units were sold for $5,000,000 and above, making up 25.43% of total units sold. At this price point, the properties bought are likely larger properties located in prime areas and/or luxury projects.
Which Districts are Foreigners Buying Non-landed Private Properties in?
When breaking down the number of non-landed private property transactions by district, it’s clear that foreign buyers flocked to well-located properties in the CCR. District 9 moved the most units with 52 transactions, followed by District 10 with 57 transactions, and District 6 with 34 transactions.
10 Most Popular Condos Among Foreigners in Q2 2022
Well-located luxury properties in prime areas dominated the charts. Riviere, Piccadilly Grand, and Normanton Park also proved to be popular among buyers in general; the three projects also made an appearance on the list of top 10 performing condo new launch projects in Q2 2022.
Other developments popular with foreign investors include One Pearl Bank, Wallich Residence, Marina Collection, Marina One Residences, Avenue South Residence, Perfect Ten and Liv @ MB.
Why Are Foreigners Snapping Up Luxury Property in Singapore?
Global markets are in turmoil and macroeconomic uncertainty is escalating on the back of the Russia-Ukraine war and rising inflation. This has pushed the global elite to search for safe havens to park their wealth and diversify their assets.
Singapore’s economic stability and rule of law make it a popular choice for ultra-rich foreign buyers. Although a new raft of cooling measures was implemented in December 2021, the prospect of paying higher Additional Buyer’s Stamp Duty (ABSD) rates is not much of a deterrent for the super-rich.
According to D.r Tan Tee Khoon, Country Manager, PropertyGuru Singapore, the plus that the Singapore property market presents as a safe haven for capital preservation far exceeds the downsides of increased ABSD rates. The 30% tax is considered to be "just another part of a transaction cost to be factored in".
Local demand for investment property has remained high throughout most of the COVID-19 pandemic. Pessimism about the affordability of housing in the future, as well as the desire to purchase an investment property before prices rise further are some factors fuelling prices in the non-landed private property markets.
“However, for the local buyers, given the rising interest rates and the fact that future housing will cost more, they can rationalise buying now and paying the current ABSD rates or they could relinquish existing residential properties which would then enable them to pay no or less ABSD in their next purchase,” says Dr Tan.
One thing is for sure – as borders open, more foreigners are likely to stimulate demand for luxury properties. If you’re interested in buying a luxury home, browse all luxury property for sale in Singapore. Need help figuring out how to finance your property purchase? Reach out to our Mortgage Experts for home financing advice.
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