There were times, not so long ago, when foreigners chose the private properties of Singapore with a high amount of interest. Considering the fast-developing background of the country, no wonder things presented themselves this way. Their desire even contributed to the increases in price regarding some properties, as it added to the growing demand of homes in Singapore. However, the year 2020 recorded a new peak in this direction. In the past 17 years, 2020 brought the lowest level of purchases, concerning private residences, made by foreigners in the country.
The last low of the kind was back in 2003, when only 671 units were sold to non-Singaporeans. In 2020, the value was close to the previously mentioned one, since only 742 units managed to be purchased by foreigners. It is worth mentioning that these numbers include new units, second-hand units, and sub-sale properties. If we are to regard what happened last year, with all the travel restrictions and lockdown measures adopted by so many countries, it is easy to understand why the numbers are looking this way.
A two-month lockdown took place in Singapore as well, which meant property viewings stopped and purchases slowed down considerably. Even if this is all over, restrictions at the borders practiced by many governments are keeping foreigners from traveling to Singapore and buying residences here. How come online tours are not driving sales up? According to the senior vice-president of research and analytics at Orange Tee&Tie, Ms. Christine Sun, those interested in luxury Singapore properties, for instance, prefer personally inspecting the place before making a final decision. So, the inability to travel over to Singapore and view properties is the biggest reason purchases made by foreigners dropped so much in 2020.
Only 4.1% of the sales recorded in 2020 were made by people outside Singapore. Thus, last year, Singapore’s residents accounted as the majority of homebuyers, reaching an 80.9% level, which is 2% higher than the level recorded in 2019. At the same time, it was noticed that Singaporeans reduced their investments over seas as well. Thus, the way last year went by affected everyone, not just foreigners.
Still, experts tend to believe that the level of purchases made by foreigners might increase once the anti-COVID-19 vaccine will be widely available. This way, with everyone protected against the disease, traveling will become an option once more. Of course, things will go that way only if the Singaporean government doesn’t adopt a set of cooling measures, meant to keep foreign purchases within the desired boundaries.
The Chinese are usually the most interested foreigners in making investments in Singapore. Because the country is more stable from a financial, political, and legal point of view, many Chinese people choose to move to Singapore and invest in a private property here. This can be quite a concern for the authorities in Singapore, since the middle-class people of China compose the vast majority of the country’s population. Thus, it means that it doesn’t take too many of them to create unbalances on the real estate market of Singapore. This is why the issuing of curbs in current policies, such as increasing stamp duty for foreigners, may be seen as options, to prevent foreigners from destabilizing the real estate market in Singapore.
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