SINGAPORE - The number of Malaysian and mainland Chinese buyers of Singapore private homes jumped in the second quarter compared to the first three months of the year, according to research from global real estate services firm DTZ.
"This increased activity coincided with heightened economic uncertainty in China and political concerns in Malaysia," DTZ noted, adding that these buyers were aiming to preserve their wealth.
Purchases by Malaysian buyers rose the most, by 53 per cent quarter-on-quarter, to 248 units. Not far behind, were buyers from China who signed for 234 units.
Together, buyers from these two countries accounted for almost half of the purchases by non-Singaporeans in the second quarter. This added up to 1,017 units - 381 units, or 60 per cent, more than in the first quarter, but still below the 1,298 units sold to foreigners in the same quarter last year.
Mr Lee Nai Jia, regional head of research at DTZ, said that the firm had expected to see a drop in the number of Malaysian buyers coming to Singapore given the fall of the ringgit - but the opposite occurred.
He told the Straits Times: "I think all the political issues in Malaysia has hindered some of the structural reforms that were supposed to take place. That has become a concern among Malaysian buyers, moving them towards Singapore."
He added: "They want to make sure that their money and their wealth is intact and doesn't depreciate further."
The reasons driving Chinese buyers were different, he said, as it was probably China's stock market plunge that spooked investors, raising doubts about China's financial stability and security. This would have caused them to see Singapore as a safe haven, said Mr Lee.
Looking forward, DTZ expects the yuan's devaluation to impact Chinese buyers in that it will drive more high net worth individuals to purchase Singapore property. But those whose wealth has been hit by China's stock market rout are likely to stay away.
Mr Lee said that DTZ would have to see whether the increase in Malaysian purchases would continue, but he added that Malaysians "continue to form one of the main non-Singaporean buyers, especially in the prime district."
DTZ's report showed that Singaporeans continued to represent the bulk of home buyers in the second quarter at about 77 per cent, unchanged from the same quarter of 2013 before tougher mortgage curbs were implemented.
As many as 3,867 units were sold in total in Q2, compared with 2,141 in Q1. Of those sold in Q2, 2,855 of the properties went to Singaporeans, compared with 1,564 in the previous quarter.