But acquisitions of private apartments and condos slip 7.4% in Q2
Foreigners including permanent residents bought 81 landed homes in Singapore in the second quarter of this year, up from 69 in Q1. And the Q2 figure is the strongest quarterly showing since Q2 2007, according to Knight Frank’s analysis of URA Realis caveats information up to July 30.
District
15, which includes Katong, Telok Kurau and East Coast Road, overtook
District 4 – where transactions are predominantly at Sentosa Cove – as
the most popular district among foreign buyers of landed property. In
Q1, District 4 was most highly sought after by such foreigners.
While foreigners picked up more landed homes in Q2 than Q1, they bought fewer private apartments and condos. The number slipped 7.4 per cent, from 2,261 units in Q1 to 2,093 in Q2, according to Knight Frank.
But Singaporeans bought more non-landed private homes in Q2 – 5,732, versus 5,315 in Q1.
Knight Frank chairman Tan Tiong Cheng said foreigners’ strong interest in landed homes reflects their growing recognition of such assets as a prized commodity in land-scarce Singapore.
‘The increased interest is not surprising as landed housing offers many foreigners a lifestyle closer to what they are used to in their home country,’ he said. ‘The added attraction is that Singapore is a very safe place, so landed housing is as secure as, say, a gated community.’
William Wong, managing director of RealStar Premier Property which specialises in selling landed homes in east and central Singapore, said permanent residents (PRs), after living in Singapore for a few years, tend to realise it’s worthwhile investing in landed property.
‘Bungalow prices (on per square foot of land basis) are still lower than apartment and condo prices on psf of strata area in the same location,’ he said.
‘On top of that, the supply of landed homes is more limited than that of condos and apartments. Landed homes also tend to maintain their value better, as the main component of, say, a bungalow’s value would be the land it sits on, whereas apartment and condo values may depreciate faster as the property ages.’
PRs who choose landed property can easily get access to the facilities they would enjoy in a condo – such as a big swimming pool and gym – by joining a club, he noted.
Mr Wong said landed property transactions started to pick up in June-July, after a slow period in March-May. ‘In District 15, bungalows in the Mountbatten and Meyer road areas can easily sell for about $1,000-1,100 psf of land today, compared with around $900 psf towards the end of 2009,’ he said.
‘In District 10, say in Coronation Road or Namly Avenue, a bungalow may cost about $1,200-$1,300 psf-plus today, up from $1,000-1,100 psf late last year.’
Besides an increase in the number of landed homes bought by foreigners in Q2, Knight Frank’s report shows their share of total landed home purchases here rose from 6.3 per cent in January-March to almost 7 per cent in April-June.
The latter figure is a tad below an 8 per cent share in Q1 2007 and Q2 2008.
The 150 landed properties bought by foreigners in the first half of this year accounted for about 6.6 per cent of landed home deals in the period. On an annual basis, the share has ranged from 3 per cent in 1996 to 9 per cent in 1995 and 1997.
Knight Frank’s analysis also shows PRs acquired 132 of the 150 landed homes bought by foreigners in the first half of this year.
The other 18 were bought by non-PR foreigners. This is not surprising as on mainland Singapore, being a PR is one of the major criteria a foreigner has to fulfil before being allowed to buy a landed home.
Sentosa Cove is the only place in Singapore where non-PR foreigners are allowed to buy landed homes, but this is still subject to approval by the Land Dealings (Approval) Unit, among other conditions.
Source : Business Times – 10 Aug 2010
