Mainland Chinese is largest foreign homebuyers in Q3 2011

By The Folks @PropTalk - November 26, 2011 No Comments

Buyers from mainland China continued to snap up private homes in Singapore 's east in the third quarter, pushing up their share of deals, according to a new report from DTZ.

The property firm, which analysed caveats lodged for both new and secondary sales, also found that foreigners bought 18.6% of all private homes that were sold in Q3 - a new high. Foreigners (excluding Singapore PRs) accounted for 16% of all private home sales in Q1 and Q2.

Buyers from mainland China were the biggest group of non-Singaporean (that is, foreigner and Singapore PR) purchasers. They accounted for 30.6% of all private home transactions in Q3, up from 26% in Q1 and Q2.

"Mainland Chinese buyers are increasingly looking to buy properties overseas, including in Singapore, as a result of property cooling measures in China which have led to residential property prices falling in some cities," said DTZ's South-east Asia research head Chua Chor Hoon.

"The predominantly Chinese population, good infrastructure and education system, and the safe and clean environment here make Singapore property an attractive investment option for mainland Chinese investors to park their money or buy a home for their children studying here."

Private homes in the east were most popular with Chinese buyers. Their purchases in teh first nine months in District 15 (Katong, Joo Chiat and Amber Road areas) and 16 (Bedok and Upper East Coast areas) totalled 419 units and made up 21.7% of their total purchases.

Standard Chartered analysts Regina Lim similarly noted in a new report this week that foreigners bought 28% of all mass-market homes (that is, homes that sell for less than $1 million) in the first nine months of this year - higher than the 19% in 2009 and 22% in 2010.

"With volumes and prices staying buoyant despite the weakening economic environment and repeated initiatives by the government to dampen the market this year, we will not be surprised if new measures directed at foreigners are introduced by the government, which in turn could negatively affect home prices, Ms Lim said.

Foreigners' share of all homes bought rose even as overall transaction volume fell.

According to DTZ, transactions of private homes fell to 6,879 units in Q3 2011 - some 24.5% lower than the 9,107 transactions recorded in the previous quarter. The figure was also lower than the average of 8,003 and 9,167 units per quarter in 2009 and 2010 respectively.

DTZ, which downloaded the caveats from URA Realis on Nov 15, also found a larger proportion of buyers with public housing addresses buying private homes with sizes below 1,000sqft, as the overall quantum for such homes is lower and hence attractive to HDB upgraders.
Source: The Business Times



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