Foreigners' share slips in private home deals

The proportion of private home transactions involving foreign buyers (including Singapore permanent residents, or PRs) slipped to 20.8 per cent in April, after recovering to 26.7 per cent in March.

In February, their share dived to 23.3 per cent following the seventh round of property cooling measures that took effect on Jan 12. In January, foreigners had accounted for 28 per cent of caveats lodged for private homes purchased in Singapore. Conversely, Singaporean buyers' share increased, from 72.5 per cent in March to 78.3 per cent in April - highest monthly share in a year.


These trends are due to the number of caveats for private homes lodged by Singaporeans rising at a faster clip than purchases by foreigners.

In April, Singaporeans lodged 1,528 caveats, up 62 per cent from March. The number of caveats lodged by foreign buyers rose 16.4 per cent month on month to 405 in April.

The bigger jump in caveats lodged by Singaporeans last month is attributed to a slew of private residential launches in March especially in the suburban mass-market segment. Such projects appealed relatively more to Singaporeans, particularly first-time buyers who have been left unscathed by the cooling measures.

As some of the options granted by developers in March would have been exercised by buyers in the following month and caveats lodged shortly thereafter, this could have accounted for the spike in caveats lodged by Singaporeans in April.

On a quarterly basis, the total number of caveats lodged for private home purchases fell 34.4 per cent, from 8,725 in Q4 last year to 5,721 in Q1.

Caveats by Singaporean buyers declined 36.6 per cent quarter on quarter to 4,153 in the first quarter - a bigger percentage drop compared with the 25.3 per cent fall in purchases by foreigners.

Hence the foreign buying share increased to 26.8 per cent in Q1, from 23.5 per cent in Q4 last year and 22.2 per cent for the whole of last year.

Providing a split of foreign buyers by nationality, China buyers retained their No 1 position. Their share of the foreign buyer pie climbed from 25 per cent in Q4 last year to 29.6 per cent in Q1.

Malysians remained the second-biggest group of foreign buyers. Their share increased from 22.6 per cent in Q4 last year to 23 per cent in Q1 2013.

Over the same period, Indonesians saw their share among foreign buyers slipping from 21.5 per cent to 19.9 per cent, though they still held on to their third position.

China buyers' share of caveats lodged by foreign buyers, which had spiked from 26.7 per cent in February to 36.2 per cent in March, fell to 28.1 per cent in April. The number of caveats lodged by Chinese citizens fell from 126 in March to 114 in April.

Meanwhile, interest from Malaysian buyers fell initially following the January 2013 cooling measures. Malaysians accounted for 21.5 per cent of total caveats lodged by foreigners in February and 13.8 per cent in March - which are markedly lower than 26.9 per cent in January 2013.

Source: Business Times –21 May 2013