Monday, August 6, 2012

Chinese foreigners buy fewer homes here

Straits Times: Mon, Aug 06

HEFTY new stamp duty and a slowing economy at home are deterring Chinese nationals from buying property here, according to new sales figures.

Once the biggest group of foreign buyers, the Chinese fell to second in the first six months of the year, purchasing 259 homes behind the 372 bought by Indonesians, according to caveats lodged with the Urban Redevelopment Authority.

Additional buyer's stamp duty has dampened foreign home demand, with overseas buyers accounting for just 7 per cent of the deals in the first half of the year, down from 20 per cent in the same period last year.

This can be seen clearly from last year's sales numbers. Chinese buyers bought 799 homes in the first six months of last year, while Indonesians bought 614 units.

Landed and non-landed sales - both new and resale - are included, but executive condominiums are excluded.

Landed sales here refer to homes sold at Sentosa Cove, as foreigners are barred from buying landed property elsewhere in Singapore.

Agents say some Chinese buyers might now be turning to the non-residential sector to avoid paying the 10per cent additional buyer's stamp duty.

Centaline Singapore general manager Clarence Chow said it was primarily the slowing Chinese economy that dragged down sales this year.

Chinese buyers typically prefer new homes and developers here are often willing to offer some form of reimbursement or absorption, so the extra stamp duty was not a big concern, he said."We are still seeing a lot of inquiries - it's more or less the same as last year - but the speed of making a purchase decision is slower," Mr Chow said.

International Property Advisor chief executive Ku Swee Yong said he had heard of Chinese buying Housing Board (HDB) shophouses and other commercial spaces where yields were higher.

"There isn't that sense of urgency... Viewings are still happening but the cheque book is not coming out," he said.

Mr Terence Teo, investment manager at developer Tong Eng Brothers, agreed that foreigners seem to be more cautious now and are sitting on the sidelines, possibly waiting for the extra stamp duty to be lifted.

Out of the 76 units sold at its recently launched Tropika East in Eunos, however, there were three foreign buyers, all of whom were Chinese nationals.

Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C
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