A sea-facing bungalow in the affluent suburban enclave of Sentosa Cove was reportedly purchased in recent weeks for more than S$39 million (US$29.2 million) by a Chinese national from Fujian Province, according to reports.
When you get closer to the settlement, Last week, a 5,070 sq ft luxurious penthouse in South Beach was sold to a Chinese citizen, according to This Week In Asia.
Last month, the Tsai family of Taiwan, which owns the Hong Kong-listed snack producer Want Want China Holdings, paid S$293 million for all 20 units of a new condominium at Eden in one of Singapore’s most exclusive neighborhoods.
Though property observers observed that the Tsai family’s high-profile acquisition was unprecedented in that high-net-worth buyers preferred secrecy and condominium developments seldom had such a small number of apartments, the three large purchases show that Singapore remains a magnet for wealthy Asian investors seeking to park their capital or find a second house.
Observers say the city-effective state’s handling of the coronavirus pandemic has piqued property buyers’ attention, notwithstanding rumors that an imminent surge in the number of ultra-high-net-worth individuals in Asia-Pacific would help Singapore’s luxury residential industry.
Some of the luxury markets has been selling well during this period especially those with bigger floor plate as purchasers prefer luxury and spacious living. Some of the developments include 15 Holland Hill, Irwell Hill Residences, Pullman Residences etc.
The number of private condos sold to foreigners in 2021 have returned to pre-pandemic peaks, according to the latest estimates from Singapore’s Urban Redevelopment Authority.
There were 91 such transactions in January of last year, just before the virus reached Singapore. Demand plummeted fourfold in April and May, when the pandemic was at its peak, but transactions rebounded to 112 in January this year, before stabilizing at 100 last month.
Sales from January to March this year is slightly higher than the monthly total of 62 units sold last year, according to Christine Sun, senior vice-president of analysis and analytics at OrangeTee & Tie. She said, “The data shows that international buyers seem to be returning to Singapore.”
Sun went on to say that amid the pandemic, Singapore’s luxury property sector had held up well, and that investors were being “increasingly persuaded” that properties in the city-state were decent long-term investments.
“In recent months, more buyers have entered the sector, perhaps expecting property prices to rise much higher this year, particularly as the global economic outlook improves,” she said.
Singapore’s economy grew unexpectedly in the first quarter following three straight quarters of contraction, the government announced on Wednesday.
Chinese nationals, according to Sun, make up the biggest category of international shoppers, accounting for 20 to 35 percent of monthly purchases.
In comparison to before the pandemic, Clarence Foo, associate division director of real estate company ERA, said he had received around 30% more inquiries from prospective Chinese buyers.
Although Beijing’s tight quarantine restrictions have kept Chinese nationals from flocking to Singapore in large numbers, Foo said a limited but steady trickle of prospective buyers has been visiting the island nation to see properties.
Singapore started enabling short-term Chinese visitors, including leisure tourists, to access the country without having to go through quarantine in November. Since then, at least 12,800 Chinese tourists have visited the city state, according to official estimates from the aviation authority.
Chinese buyers, according to Foo, aim to see several assets virtually before flying to Singapore to complete the sale.
Although foreign homebuyers were generally taking a wait-and-see approach due to travel restrictions, Christine Li, head of Asia Pacific research at real estate consultancy firm Knight Frank, said that inquiries she had received suggested that some from China were ready to purchase property in Singapore once borders were opened.
According to Foo, Chinese shoppers are constantly considering health risks while making purchases. They were now looking for countries where the virus had been contained so that they could go there and linger for a few months.
“We want areas where they can walk about more easily, where there is no lockout and no lack of medical supplies,” he added. “There aren’t many countries going better in this respect outside of China.”
Foo also stated that a number of his Chinese clients were considering establishing family offices in Singapore, with budgets ranging from S$4 million to S$10 million.
Potential buyers praised Singapore’s “secure haven” virtues, such as ease of doing business, a healthy political climate, and low taxation, according to Li of Knight Frank. She added that, as compared to other cities such as Shanghai, Seoul, and Hong Kong, Singapore stuck out for its strategic advantages, as much of Asia-Pacific was within a six-hour trip.
“Unlike Seoul and Hong Kong, which have seen civil strife in recent years, its domestic sociopolitical situation has been stable,” Li said.
According to David Chandran V R, managing director of real estate company Cosmopolitan Real Estate, wealthy people place a higher value on their families’ life, welfare, and well-being.
“This pandemic has placed enormous strain on many countries, and more rich citizens are starting to see and understand how Singapore has handled the situation,” he added.
If the wealthy mainland Chinese population grows, the Singapore property market has the ability to profit from the spillover impact.
Singapore was ranked the top Asia jurisdiction of preference for Asians seeking to purchase a new investment home in a study published by property company Knight Frank in March.
According to the Wealth Study, the population of ultra-high-net-worth individuals in Asia-Pacific – all with a net worth of more than US$30 million – is expected to rise by 33% in the next five years, outpacing the global level of 27%. This will bring the total amount of ultra-high-net-worth people to about 170,000.
According to the survey, there was a 10.2 percent increase in such tycoons in Singapore last year, totaling 3,732.
The amount of billionaires and millionaires in Asia-Pacific is expected to grow by 46% and 37%, respectively, over the same timeframe, according to the study. “The Asia-Pacific area now has more billionaires than any other region, with China playing a key role.”
The rise of wealthy individuals will have spillover effects on luxury property in Singapore especially luxury condo in the Core Central Region (CCR), according to Victoria Garrett, head of residential property in Asia Pacific at Knight Frank, who added that Chinese investors were still looking to diversify their assets.
“They see Singapore as a safe-haven investment destination because of its secure political climate, strong market openness, world-class infrastructure, and high-quality infrastructure,” Garrett said.
“As a result, if the affluent mainland Chinese population grows, the Singapore property sector has the ability to profit from the spillover effect.”