Us Buyers Lead Foreign Demand Singapore Third Straight Year
In the first half of 2024, there were only 64 residential property purchases made by foreigners (non-permanent residents) in the Core Central Region (CCR). This number increased from 21 in the first quarter to 43 in the second quarter, bringing the total for the first half of the year to 64. According to PropNex Research, the majority of these transactions (56%) were made by buyers from the United States (see Tables 1 and 2).
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The data from PropNex Research and URA Realis shows the top five countries in terms of residential purchases by year. As of June 24, 2024, the data for 2Q2024 is only by nationality and residential status. Transactions by US buyers in the CCR have been on the rise since 2019. In 2022, there were 130 transactions made by US buyers, surpassing the 114 transactions made by Chinese buyers during the same period.
CEO of PropNex, Ismail Gafoor, attributes the increase in home purchases by US citizens to the fact that they are eligible for the same stamp duty treatment as Singaporeans under the free trade agreement (FTA) between the two countries. He also notes that nationals and permanent residents of Iceland, Liechtenstein, Norway, and Switzerland are also given similar stamp duty treatment under their respective FTAs with Singapore.
While the outlook for the market may remain subdued for the rest of the year, Gafoor points out that the average transacted prices of non-landed private homes in the CCR have held steady despite the hike in additional buyer’s stamp duty (ABSD) in April 2023. Based on data from PropNex Research and URA Realis as of June 24, 2024, the average price of a new sale of non-landed homes in the CCR was $3,273 per square foot (psf) in 2Q2024, which is higher than before the ABSD hike in April 2023 (see Table 3, “Average transacted unit prices”). On the other hand, the average resale price of non-landed private homes in the CCR was $2,133 psf in 2Q2024, slightly lower than the $2,172 psf in 2Q2023.
However, Gafoor also notes that there has been a significant decrease in new sales of non-landed homes in the CCR (see Table 3, “Transaction volumes”), partly due to fewer launches in the segment following the implementation of property cooling measures. He mentions that potential upcoming launches in the CCR in the second half of 2024 include projects like the 683-unit Marina View Residences, the 186-unit Aurea at the former Golden Mile Complex, and the 367-unit The Collective at One Sophia. Additionally, there may be new launches in the Rest of Central Region, such as the 366-unit Union Square Residences, in the second half of 2024.