SINGAPORE: Strong demand from mainland Chinese buyers helped Singapore private home prices edge higher in the first quarter of the year, despite government efforts to cool the market, property consultants Jones Lang LaSalle (JLL) said yesterday.
The average value of non-prime private apartments in Singapore reached a record high of S$1,043 (S$1 = RM2.40) per square foot in the first quarter, exceeding the previous high of S$1,020 psf in the last three months of 2010, JLL estimates.
Singapore, like Hong Kong, has found it difficult to keep a lid on property prices due to the surge in global liquidity that has pushed mortgage rates to near record lows as well as strong demand from cash-rich China nationals. The increasing cost of owning a home has become a political issue ahead of general elections that may take place as early as next month. Chinese nationals made up the largest group of foreign buyers of Singapore property, accounting for about one quarter of all purchases by foreigners in the city-state, JLL added.
"The surge in Chinese buyers in Singapore coincided with the policy tightening in China," said Chua Yang Liang, JLL's head of research for Southeast Asia. The strong demand from China will continue so long as Beijing's fiscal and monetary policies remain conducive to overseas investment by wealthier Chinese nationals, he added.
Chinese investors last year overtook Indonesians to become the largest group of foreign buyers of Singapore residential property. In the first three months of the year, mainland Chinese accounted for nearly one-third of purchases by non-Singaporeans in the top end of the market which JLL defined as homes worth S$5 million and above.
Singapore has stepped up construction of lower-cost government apartments and increased subsidies for first-time home buyers in the lower-income groups in a bid to cool the housing market. It also introduced new anti-speculation measures on January 13 that included tougher borrowing limits and a hefty stamp duty of 16 per cent of the selling price for those who buy and sell within 12 months.
Singapore private home prices rose 17.6 per cent last year despite government attempts to cool the market in February and August. The country's Urban Redevelopment Authority will release flash estimates for private home prices in the first quarter on Friday. - Reuters
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