Singapore private home sales surging on local, not foreign, demand, data shows

Developers in Singapore sold 1,780 private homes in March 2017, up nearly 82 per cent from the 979 units they moved in the previous month and also 111 per cent higher than the 843 units they sold in March 2016.
Developers in Singapore sold 1,780 private homes in March 2017, up nearly 82 per cent from the 979 units they moved in the previous month and also 111 per cent higher than the 843 units they sold in March 2016.PHOTO: ST FILE

SINGAPORE (BLOOMBERG) - After years of declines, Singapore's home sales are on a roll, even as purchases by foreign buyers have remained muted.

Stringent stamp duties levied by the government have had the intended effect of damping speculative foreign demand, with foreign buyers accounting for just 6 per cent of purchases in the first half, data from Cushman & Wakefield show. That compares with 9 per cent as recently as 2013, when mortgage rules were tightened.

Developers sold 7,147 private homes in the first seven months of the year, 50 per cent higher than in the same period a year earlier. So who's buying all these homes? It's local Singaporeans.

Among foreign buyers, the biggest pullback was by Malaysian and Indonesian buyers, while Chinese demand held steady. Malaysian buyers among foreign purchasers dropped from 26 per cent in 2013 to 21 per cent in the first half of this year, while the Indonesian proportion slid to 6 per cent from 17 per cent in 2013.

The Chinese share, the biggest of any group, has been at 29 per cent or 30 per cent since 2013.

Developers say they are seeing signs of a recovery in the private housing market.

CapitaLand chief executive officer Lim Ming Yan said this month that the residential market may be "bottoming out," while City Developments executive chairman Kwek Leng Beng said he saw signs of a pick-up.

Singapore's property prices have dropped for 15 straight quarters, the longest slide since the data were first published in 1975, because of cooling measures rolled out since 2009. Home values are down 12 per cent from a 2013 peak.