Foreign Buyers Show Resilience In The Luxury Condo Market

Foreign Buyers Show Resilience In The Singapore Luxury Condo Market
While the property cooling measures of 2018 have dampened demand for housing real estate, foreigners who purchased top-end condominiums are showing more resilience. This is good news for property agents starting their careers.These cooling measures that was in place since July 2018 may have reduced overall home-buying demand, but foreigners seem to be undaunted with regards to high-end condos, reported The Business Times, in accordance to a report by ERA Research and Consultancy, a property agency in Singapore.The ERA report, with data taken from the Urban Redevelopment Authority’s (URA) Realis, showed that the number of non-landed private residential units in the Core Central Region (CCR) purchased by Singapore citizens reduced to 2,427 units after the measures – a 38% drop.Transactions made by permanent residents and foreigners, meanwhile, declined by 30% to 1,264 units. Residential property purchases made by companies in the CCR reduced to 49 units from 142 units, reflecting a drop of nearly two-thirds.The ERA report covered transactions done for non-landed real estate units in the CCR (Districts 9, 10 and 11, Sentosa Cove and the Downtown Core) and excluded both executive condominiums (ECs) and landed housing. The data was compared between the 18 months before the cooling measures (January 2017 to June 2018) and the 18 months after (July 2018 to December 2019), and included PRs under foreigners.

Meanwhile, the number of private residential homes sold across all Singapore regions declined by around 23% to 25,270 units, compared to 32,866 units before the cooling measures were implemented. There was a 20% reduction for Singaporean buyers and a 32% reduction for foreigner buyers. Many were keen on the units for sale at Jadescape.

One of the latest cooling measures was the increase in the Additional Buyer’s Stamp Duty (ABSD). The stamp duty for citizens buying a second home went up to 12% from the earlier 7%, while those purchasing their third and subsequent property were subjected to 15% ABSD, which was previously only 10%.

Foreigners are now subjected to a 20% ABSD, while permanent residents (PRs) have to pay 15% ABSD for their second and subsequent purchased properties.

For the high end residential property sector, the report explained: “foreign purchasing demand was more resilient than local demand as the result of the latest cooling measures.”

This implies that foreigners who are willing to pay higher ABSD are the high net worth individuals keen in luxury homes, and they are always looking for learned professionals to help them source the best properties. Build your Property Agent Career on the back of Singapore’s good reputation and stable property market.

“Foreign purchasing demand in the high-end residential property market weathered the cooling measures much better than demand in the rest of the real estate market, showing that the underlying demand for prime properties from foreign home purchasers was still relatively healthy,” the report said.

“Singapore citizens have always been the biggest group of purchasers of luxury homes in Singapore, even in the aftermath of the 2018 cooling measures”, mentioned the report.

Chinese nationals biggest group of purchasers for high-end residential units

From July 2018 to December 2019, Singaporeans formed 65% of the buyers for non-landed residential units in the CCR, while foreigners and companies only make up 34% and slightly over 1% of the purchasers respectively. The One Bernam location is one of those popular sites of these buyers.

The positioning of the biggest group of foreign purchasers of high-end non-landed residential real estate maintained mostly the same, even as the number of units purchased by buyers from Dominica, Vanuatu, Cambodia, Denmark, Cyprus, Spain, and Thailand dropped after the cooling measures’ implementation.

After the measures, Chinese nationals bought 380 non-landed units in the CCR. This made them the largest group of buyers for high-end residential properties. This is good news for people’s Property Agent Careers.

Indonesian purchasers bought 149 non-landed homes in the CCR, sufficient to put them in second place. Americans maintained the fourth position, while buyers from Taiwan and Hong Kong completed the rest of the top 5 ranks.

The ERA report covered the CCR and compared data under the 18 months before the implementation of the cooling measures (January 2017 to June 2018) and the 18 months after the implementation (July 2018 to December 2019). It did not include executive condominiums and landed housing but did include permanent residents and foreigners.

Source: https://sg.finance.yahoo.com/news/foreign-buyers-show-resilience-luxury-042418311.html

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