Friday, May 25, 2012

China buyers lose property top spot

Straits Times: Fri, May 25
BUYERS from China have lost pole position among foreign purchasers of Singapore property in the wake of December's tough cooling measures.

Mainland buyers, and other foreigners, have fled the local market in droves, stung by a hefty 10 per cent additional stamp duty.

A report by DTZ Research found that Chinese, including permanent residents, bought just 292 homes in the first quarter. This is 54 per cent down from the 640 homes bought in the fourth quarter last year and the lowest volume in more than two years.

The proportion of Chinese buyers among non-Singaporean buyers fell correspondingly to 23 per cent from 29 per cent in the three months before, the sharpest drop among all nationalities.

Malaysians reclaimed the top spot with 362 home purchases - a 28 per cent share among foreign buyers - possibly due to the larger number of Malaysian permanent residents here.

Tough cooling measures unveiled last Dec8 slapped a 10 per cent additional buyer's stamp duty on all home purchases by foreigners. But permanent residents had to fork out only an extra 3 per cent on their second and subsequent home purchases.

As a result, demand from non-permanent resident foreigners has nosedived 75 per cent to just 336 units. Their proportion of the private market fell to a three- year low of just 6 per cent. Permanent residents took a 16 per cent share, while Singaporeans made up the remaining 78per cent.

DTZ said the fall in the proportion of foreign purchases post-additional buyer's stamp duty has proved more drastic than a major policy change 17 years ago...
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