Singaporeans’ appetite for overseas properties appears to have diminished due to the weakening local economy and a possible interest rate hike in the future.
According to the Monetary Authority of Singapore (MAS) and reported in the media, buyers from Singapore purchased approximately $1.1 billion worth of real estate in other countries during H1 2014, compared to more than $1.6 billion in the same period a year ago.
“Nonetheless, real estate agencies in Singapore have seen increased interest in overseas property purchases, from across a broader spectrum of Singapore buyers,” said the central bank in its latest Financial Stability Review.
In terms of quantity, properties in Australia, Malaysia and Great Britain made up 76 of the transactions for the first half of 2014, and 91 percent by value. Aside from those markets, Singaporeans also purchased properties in Japan, Thailand and the Philippines.
“The lower price quantums of properties in some markets might have made them more attractive to lower- and middle-income households,” it said, adding that Singaporeans should bear in mind the additional risk involved in these transactions.
Separately, MAS noted Singapore’s property curbs have moderated the growth of outstanding housing loans here.
Property loans grew 23 percent on an annual basis in August 2010, but by September 2014, it expanded only by six percent from the same month last year.
Additionally, the volume of new housing loans plummeted to $6.7 billion in the third quarter of this year versus the $11.4 billion seen in Q2 2013.