Aerial view of luxury properties in Keppel Bay.
The surprisingly strong sales momentum witnessed at the recent launch of New Futura, in which foreigners accounted for close to 60 percent of the 48 units sold, indicates that foreign demand is returning to Singapore, reported Singapore Business Review citing DBS Equity Research.
This comes as the city-state is considered more attractive than other global markets, said Ong Teck Hui, national director, research at JLL.
More: New Futura condo sells 18 units at average price of $3,200 psf
“The Singapore private residential market is in the early stages of recovery, promising a longer run in price upside. Melbourne, Sydney, Hong Kong and Tokyo are at the upper end or near the peak of their market cycles, whilst the prime London market is in decline,” he said.
Cushman and Wakefield research director Christine Li sees the increase in foreign demand within the luxury segment.
She noted that while the increase in high-end sales volumes was mostly attributed to Singaporean demand, the number of foreign buyers has also increased. In fact, purchases by foreign buyers rose 63 percent to 900 units last year, from 553 units in 2016.
Anecdotally, some foreigners opt to secure permanent resident status first prior to acquiring a property to qualify for a lower Additional Buyer’s Stamp Duty rate, she said.
With the private housing market on the cusp of recovery, Li believes the luxury segment offers an attractive value proposition since prices of similar high-end condos in overseas markets such as New York and Hong Kong haven’t softened.
“As such, we expect foreign demand to continue to rise in 2018, as foreigners look for safe havens to preserve their wealth amidst (the) uncertain global economic climate,” said Li.
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Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email email@example.com