Private home acquisitions by foreigners drop 26.1% in Q1 2020
To guard their wealth against the weakening yuan and the anticipated inflation, wealthy Chinese investors are turning to luxury real estate, with Singapore as one of their favourite destinations.
And given the rise of online platforms, photos and virtual tours have been enough to close multi-million dollar deals with such group of investors.
Clarence Foo, a property agent with ERA unit, APAC Realty, revealed that three Chinese clients purchased six apartments worth a total of $20 million at Marina One Residences even without any virtual tours this month, reported Bloomberg.
Another investor acquired three separate three-bedroom units within the same development for around $12 million. Marina One Residences is a five-minute walk to Marina Bay Sands hotel and casino.
“Some buyers may want to divert their funds to other countries as the yuan may be devalued further to combat the weakening of their economy,” explained Christine Sun, Head of Research and Consultancy at OrangeTee & Tie in Singapore.
Rich Chinese investors used to favour Hong Kong due to its proximity to mainland China. However, the pro-democracy protests forced them to turn to Singapore, despite the city-state’s higher taxes.
“They view Singapore’s property market as a safe haven because of its stability. It’s a more regulated market compared to say Hong Kong,” said ERA’s Foo.
Chinese buyers also turned to South Korean properties, which saw inquiries from such buyers soar 180% in the first quarter of 2020 from the previous quarter, while New Zealand homes posted a 75% hike in inquiries, showed data from real estate firm Juwai Iqi.
The rush to add real estate offered some support for Asian property markets that have been hit hard by the Covid-19 pandemic.
“It’s been flat-out,” noted Monika Tu, founder of Black Diamondz, an Australian firm catering to Chinese buyers of luxury property.
Since March, Tu sold A$85 million (S$79 million) of prime property, with around 50% of sales to Chinese buyers who were in Australia when the Covid-19 pandemic hit. Priced from A$7.25 million (S$6.8 million) to A$19.5 million (S$18.2 million), the homes are all located within Sydney’s well-heeled, ocean-front suburbs like Point Piper.
Source: Yahoo Finance
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