Global Market Guide: Singapore
As luxury markets around the world fluctuate in light of COVID-19, we see both noticeable differences as well as similarities from region-to-region. Take a closer look at the luxury real estate market in Singapore and discover how regulations, the pandemic, tourism and the demand for new construction affects the purchase intent of luxury buyers.
Current Housing Market
Luxury buyers are gravitating to Singapore’s Central Business District, as the government has unveiled a masterplan to create a space for residents to live, work and play through the addition of residential properties to the city’s business hub, with numerous developments currently in the works.
Luxury Buyer Profile
Singapore has experienced a surge in Chinese and Hong Kong buyers during the last 2 years, as well as those from Southeast Asia (Indonesia/Malaysia) and the United States. The market is still stable for locals, however, as the government has implemented cooling effects to keep housing affordable for their younger generations.
Attracting Luxury Buyers
The previously mentioned international buyers often prefer the prime, central locations that they’re most familiar with, including the popular Districts 9, 10 and 11. They’re also driving the preference for larger units, as well as freehold contracts, as new land releases by the government are typically 99-year leaseholds. Freehold contracts, by contrast, mean that the owner may own the land indefinitely.
Luxury buyers desire exclusive and high-end condominiums built by reputable developers, preferably with extensive landscapes, amenities and private elevators. Additionally, they’re more apt to choose properties that are tax-friendly and exclude any capital gain or inheritance taxes, so that the home may be passed down to the next generation with peace-of-mind.
New development growth has been significant, with LeadingRE member, One Global Property Services, reporting 52,365 new units in their sales pipeline through 2023. Within the region overall, some current noteworthy projects include One Marina Residence, Wallich Residence, South Beach Residence and Boulevard 88.
Over the past decade, Singapore’s government has been implementing several rounds of cooling measures to stabilize the local housing market, which otherwise would have likely been overly heated. This has been done with the intent of ensuring overall price stability and affordability for the country’s younger generation. It is also anticipated that, due to COVID, these cooling effects will amplify the intended effects of the cooling measures.
Additionally, borrowing is becoming attractive again as interest rates are historically low. This will likely attract long-term investors looking to re-enter the property market.
Due to pandemic-related restrictions, in-person viewings have not been possible during the last few months. As a result, brokerages in Singapore, like many across the globe, have become increasingly digitized, with many operations done remotely, including virtual tours and transactions. It is expected that a new normal is being established and much of the digitalization is here to stay.
It is worth noting, however, that in-person viewings are still preferred, as virtual tours don’t provide buyers the same emotional response as a physical showing. As a result, should COVID remain longer than expected, it may translate to lower sales volume and/or slowed transactions.
Special thanks to One Global Property Services PTE LTD, a brokerage member of Luxury Portfolio International, for providing us this insight on Singapore’s real estate market.
One Global combines access to the finest properties in London, Singapore and other dynamic markets, with a truly consultative approach to all client property needs. The boutique real estate agency offers end-to-end service, with associates serving as trusted advisers to their clients and simplifying transactions within their international market. Read more about One Global.