ARE MORE FOREIGN BUYERS COMING TO THE SINGAPORE PROPERTY MARKET 2020? HERE’S THE TRUTH BEHIND IT

March 31, 2020
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Image Credit: forbes.com

It is no secret that Singapore is a popular location among wealthy foreigners to park their businesses and settle down. Some well-known Singapore residents include Facebook co-founder Eduardo Saverin and actor Jet Li.

jet li
Image Credit: 99.co

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Jet Li: Bungalow at Bukit Timah

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wallich residence at guoco tower
Image Credit: CNA

Property purchases by these wealthy billionaires often grab news headlines. In 2019, for instance, Sir James Dyson – founder of Dyson vacuum cleaners – reportedly purchased Singapore’s most expensive penthouse at Wallich Residences. The 21,000 sq ft triplex was sold for $73.8 million and has its own private lift, 5 bedrooms, a 600-bottle wine cellar, and a private pool on the roof terrace with an unmatched view of the city.

British billionaire James Dyson snaps up Singapore's priciest penthouse

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james dyson bungalow
Image Credit: mothership.sg

Some weeks later, Sir Dyson reported made headlines again for purchasing a good class bungalow in Bukit Timah worth over $45 million. The 15,100 sq ft GCB is set on a hill and overlooks the Singapore Botanic Gardens.

These purchases mark a growing trend in the Singapore property market.

Property purchases by foreign buyers on an uptrend

Private non-landed home sales excluding executive
condominiums by residential status
For 2019
Singaporean13292 units
Singapore Permanent Residents (PR)2615 units
Foreigner (NPR)1039 units
Source: OrangeTee & Tie Research & Consultancy

Last year, 6.1% of total non-landed home sales excluding ECs were bought by non-permanent residents Including PRs, the proportion would be 21.5%.

OT NPR

In recent quarters, about 6 to 9 months after the cooling measures were implemented in July 2018, there has been a gradual uptrend in foreigners buying properties here.

Here’s what else you need to know about these buyers.

Who are these foreign buyers?

According to OrangeTee & Tie research, the largest proportion of foreign property buyers in Singapore come from China. Christine Sun, Head of Research and Consultancy at OrangeTee & Tie, notes that many of these property investors may have shifted their funds from China after the RMB was devalued during the US-China trade war.

“The low-volatility and strength of our currency, undergirded by sound fiscal policies and a stable financial system, have boosted investors’ confidence that their property investments in Singapore will continue to hold value in the long run,” said Sun.

“Therefore, property investors from foreign countries like China may feel that they are able to  preserve their wealth and enjoy a return on their investment in the long term when they buy properties here.”

Which districts do foreign buyers prefer?

The table below shows the 10 most popular districts for foreign buyers, both PRs and non PRs in 2019.

The most popular districts weredistrict 19 (Serangoon Garden, Hougang, Punggol) followed by district 3 (Queenstown, Tiong Bahru) and district 10 (Ardmore, Bukit Timah, Holland Road, Tanglin)

Private non-landed home sales excluding executive condominiums by residential status in 2019

DistrictsPR + NPR
19384
3353
10312
18281
9272
5255
14242
15206
13179
23121
Source: URA, OrangeTee & Tie Research & Consultancy

Foreign buying trend in Singapore 2020

With the COVID-19 outbreak, are foreign buyers still interested in buying a property in Singapore? OrangeTee’s Sun seems to think so.

“Foreign buyers will continue to buy properties here when the situation stabilizes and border controls around the world are lifted. Singapore is strongly regarded as a safe haven to park their funds here, especially in times of uncertainties.”

As more foreign buyers come into the property market during the current turmoil in global markets, will it inflate prices, putting properties in certain districts out of reach for Singaporeans?

Despite the headline-grabbing property purchases like those acquired by Sir Dyson, the answer is no, according to Sun. “As of now, the majority of buyers are still Singaporeans,” she explained. “There will be a pent-up demand by foreign buyers as they are likely to flock to Singapore when the situation stabilizes.

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Source: URA, OrangeTee & Tie Research

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