Singapore non-permanent residents in property buying spurt

With more and more property being brought by foreigners in Singapore, the increase in non-permanent residents buying property has outpaced that of permanent residents (PR) the Singapore Business Times has reported.

The number of non-landed homes bought by non-PR foreigners jumped 37.1 per cent to 3,988 units in 2010 compared with a 12.1 per cent rise of those bought by PRs, according to a Knight Frank analysis of URA Realis caveats data.

Chinese and Indian nationals led the trend. The study shows a 90.4 per cent jump in the number of apartments/condos bought by non-PR Chinese nationals to 817 last year – versus a 31.5 per cent increase in the number of such homes picked up by Chinese national Singapore PRs last year to 794 units. Amongst Indian nationals, non-PRs posted an almost 50 per cent surge in units bought to 238 compared to a 16 per cent rise by PRs to 788.

Market watchers say this reflects Singapore’s ongoing transformation into a more globalised city and investment market.

“China and India are clearly the economic powerhouses of the world and Singapore has always been seen as an attractive country to invest in, due to transparency of law, absence of capital gains taxes and no entry barrier for apartment/condo purchases,” said Knight Frank chairman Tan Tiong Cheng.

Knight Frank’s research also showed an increase in property bought in Singapore by PR and non-PR UK citizens. The number of units picked up by UK citizens who were not PRs increased around 58 per cent to 185 units, while the number of units bought by Brits who were PRs here rose 48.5 per cent to 153.

Combining PR and non-PR foreigners, Chinese citizens overtook Indonesians to emerge as the second biggest group of foreign buyers of apartments and condos in Singapore last year. They lodged a total of 1,611 caveats last year, ahead of the 1,555 caveats by Indonesian buyers. However, Malaysians held on to their pole position, with 1,858 caveats. Indian and UK citizens maintained their fourth and fifth positions with 1,026 and 338 caveats lodged respectively.

Knight Frank also uncovered a divergence in buying preferences for non-landed homes between PRs and non-PRs within some nationalities last year.

For instance, Malaysians who are PRs here preferred suburban locations like Districts 14 (which includes Eunos and Geylang), 18, 19, and 23. On the other hand, their compatriots who are not Singapore PRs here tended to zoom in on ‘investment-grade’ locations – like Districts 4 (which includes Sentosa Cove), 9, 10, 11 (Singapore’s traditional prime districts) and 15 (which includes the Meyer Road and Katong vicinity).

“Perhaps Malaysian buyers who are Singapore PRs and working here have smaller budgets or may want to settle down here. So they’re looking for a home in the suburbs, while the Malaysians who don’t live here are more likely to buy a Singapore residential property for investment,” said Tan.