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Thread: Foreigners snapping up more pricey homes

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    Default Foreigners snapping up more pricey homes

    http://www.businesstimes.com.sg/sub/...53540,00.html?

    Published May 25, 2011

    Foreigners snapping up more pricey homes

    Their share of private home-buying has risen, especially at the higher end

    By UMA SHANKARI


    (SINGAPORE) The proportion of private homes bought by foreigners jumped to 16 per cent in the first three months of 2011 - the highest quarterly percentage ever recorded since Q1 1995, when the data was first made available for analysis.

    The previous high of 15 per cent came in Q4 2007, at the height of the last property boom. DTZ, which analysed caveats lodged for both new and secondary sales, said that foreigners accounted for 13 per cent of all private home purchases in Q4 2010.

    DTZ's analysis also shows that more foreigners bought high-end homes in Q1 2011. For homes that cost $1.5 million and above, the proportion of purchases by foreigners rose to 21 per cent in the quarter, up from 17 per cent in Q4 2010.

    But on the other hand, more Singaporeans picked up homes for under $500,000. According to DTZ, Singaporeans accounted for 80 per cent of purchases below $500,000 in Q1 2011, up from 72 per cent a quarter earlier.

    This reflects the smaller budget among Singaporean buyers, said DTZ's Southeast Asia research head, Chua Chor Hoon.

    Anecdotal evidence from the ground confirmed the trend.

    Wendy Tang, Knight Frank's director of residential services, said that the proportion of foreigners and permanent residents (PRs) who bought units in new launches marketed by Knight Frank rose to 31 per cent in the first quarter of 2011, up from 20-25 per cent in earlier quarters.

    DTZ also found that the ratio of mainland Chinese (both foreigners and PRs) among non-Singaporean buyers reached a new high of 24 per cent in Q1 2011 - the first quarter that they are the top foreign purchasers of residential properties in Singapore.

    The Chinese overtook the Malaysians, who have held the top position since Q2 2008. The Malaysians' share among non-Singaporeans dipped from 24 per cent in Q4 2010 to 21 per cent in Q1 2011.

    DTZ, which downloaded the caveats on May 10, found 6,368 caveats lodged for private homes sold in the first quarter - some 25 per cent lower than the 8,455 transactions recorded in Q4 2010 as a new round of cooling measures implemented by the government on Jan 14 affected demand.

    The most significant fall was for secondary sales in February, with 745 caveats compared to 1,664 in January 2011 and 1,890 in December 2010.

    However, the volume rebounded to 1,592 caveats in March, close to the January level, as the knee-jerk reaction to the cooling measures appeared to wear off.

    The primary market showed less adverse effects from the cooling measures.

    Developers sold 1,210 new units in January, just slightly below the 1,332 units sold in December 2010. And following the cooling measures, February's new sales volume defied expectations with about 1,100 units sold.

    The new sales number then recovered by March to record close to 1,400 units as the sustained level of launches and liquidity in the market continued to drive demand.

    But analysts also warned policy changes could dampen demand in the coming months.

    'The recent General Election has magnified the strong concerns among locals regarding high housing prices and the influx of foreigners,' said DTZ's Ms Chua. 'It could prove to be the catalyst for more forthcoming policies to address the concerns, which would dampen demand in the residential market.'

    Cushman & Wakefield managing director Donald Han said that household income ceiling for buying new HDB flats could be raised, which will also impact the demand for private homes, especially in the mass-market segment.

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    http://www.straitstimes.com/PrimeNew...ry_672241.html

    May 25, 2011

    Foreign home buyers hit record in Q1

    By Esther Teo, Property Reporter


    FOREIGN home buyers snapped up 16 per cent of all private homes sold in the first quarter - the highest quarterly percentage since data became available in 1995.

    Experts say the high foreign proportion in the market is because such buyers have been less affected by the rounds of cooling measures which have muted local interest.

    The overseas impact has been telling, according to the DTZ Research report that contains the new buying figures.

    Its analysis of caveats lodged for both new and secondary sales found that foreigners bought 1,028 units in the three months to March 31. That 16 per cent share of the market tops the previous record of 15 per cent - or 784 units - in the fourth quarter of 2007.

    Foreigners were also active in the last quarter of last year when they bought 1,092 units, accounting for 13 per cent of the market.

    Demand from permanent residents (PRs) remained stable at 13 per cent in both quarters.

    DTZ said Chinese buyers - including permanent residents - also set a record, accounting for 24 per cent of purchases made by non-Singaporeans in the quarter. They have overtaken Malaysians for the first time.

    Malaysians have held the top position since the second quarter of 2008 but have seen their market share dip from 24 per cent in the fourth quarter of last year to 21 per cent in the first quarter.

    Homes in District 16 - this comprises Bedok and Upper East Coast - saw greater buying interest from foreigners compared with last year.

    District 18 - including Tampines and Pasir Ris - and District 23 comprising Hillview and Chua Chu Kang were also increasingly popular.

    DTZ's head of South-east Asia research, Ms Chua Chor Hoon, said foreign interest has remained stable at about 1,000 units a quarter over the past 12 months as Singapore has maintained its reputation as a safe investment haven.

    The new high is due mainly to a drop in the number of purchases by Singaporeans as the January cooling measures have had a larger impact on them, said Ms Chua, who added that interest from foreigners is expected to remain stable in the next few quarters.

    'However, local concerns about high housing prices and the influx of foreigners that were magnified during the recent general election will be a catalyst for the review of immigration and housing policies, which could dampen demand in the residential market in the coming months,' she noted.

    Other experts added that interest from foreigners has been sustained due in part to the buzz created by the two integrated resorts and the country's growing strength as a financial hub.

    Dr Chua Yang Liang, head of research at Jones Lang LaSalle South-east Asia, said that China's moves to tighten lending policies might have led Chinese buyers to turn to Singapore while some Europeans moving here to work have chosen to buy rather than rent.

    'Regional economic conditions - in Singapore, Indonesia and Australia - are strong and this means that foreign buyers are likely to remain active here as Singapore positions itself as a global city,' he added.

    Ms Wendy Tang, Knight Frank's director of residential services, said most foreign buyers are Asians with a long-term perspective and attracted to the stability that Singapore offers. The strengthening Singdollar also assures investors that this is a good place to park their cash.

    Foreigners also bought more into the high-end market. They accounted for 21 per cent of all the homes sold for $1.5 million and above in the first quarter, up from a 17 per cent share in the previous three months.

    January's cooling measures were noted to have made an impact, mostly in the secondary sales market. The number of caveats fell by more than half in February to 745, from 1,664 in January.

    But the secondary sales volume rebounded to 1,592 caveats in March as the initial reaction to the cooling measures appeared to wear off, DTZ said.

    Private homes smaller than 1,000 sq ft continued to be popular with HDB buyers, with the proportion of such buyers rising from 41 per cent last year to 46 per cent in the first quarter.

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