- There has been a flurry of purchases of condominiums, driven predominantly by multimillionaires from mainland China
- Some buyers may have sought an alternative to protest-hit Hong Kong, an expert said
Sales of Singapore flats worth at least S$10 million (US$7.3 million) have hit an 11-year high, fuelled by increased demand from Chinese millionaires seeking safe-haven assets, property consultants OrangeTee & Tie said.
Investors have long viewed Singapore as an island of stability that attracts the super-rich from its less developed Southeast Asian neighbours, as well as multimillionaires from mainland China.
In the first eight months of 2019, 68 condominium units in the city state were sold for S$10 million and more, the highest tally since the corresponding period of 2008.
Sales of such flats also exceeded the numbers racked up for each full year from 2011 to 2018, the consultants' analysis of transaction data shows.
'Hype, smoke, and hot air' clouding Singapore real estate
Some buyers may have sought an alternative to rival financial hub Hong Kong, hit by protests, while others may have shifted funds from China after its yuan currency was devalued in a trade war with the United States, an OrangeTee expert said.
"This may explain why we have observed more foreign buyers, especially mainland Chinese, coming into Singapore lately," said Christine Sun, its head of research and consultancy.
Mainland Chinese are the biggest group of foreign buyers of Singapore luxury homes.
In Singapore's prime districts, Chinese citizens bought 76 flats worth more than S$5 million in the period from January to August, versus 75 purchases by Singaporeans, data until September 19 show.
Expensive flats in premium neighbourhoods are mainly bought by foreigners, because at such high prices Singaporeans have the option to buy landed property, such as bungalows and mansions.
Singapore back in play as more Hongkongers consider migrating
Singapore does not allow foreigners to buy landed homes, except for those on the resort island of Sentosa.
"We do see that even though the stamp duties have increased … we are still seeing people putting big money on these flats, predominantly it is more for stability than anything else," said Boon Hoe Leong, chief operating officer of high-end property agent List Sotheby's International Realty.
He was referring to measures Singapore adopted last year to cool its real estate market, such as hiking additional stamp duties for foreign buyers to 20 per cent from 15 per cent.
"They are parking their money here " they know that the Sing dollar will not depreciate overnight," he added.
Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.