Mainland Chinese acquired private homes in Singapore at a record pace in Q4 last year, according to the Urban Redevelopment Authority (URA).
Analysts also said that more mainland Chinese will continue to invest in the Singapore property market, due to China’s tightening measures.
Mainland Chinese accounted for 23 percent of the total private home acquisitions in Singapore by non-Singaporeans, according to property consultancy firm DTZ, surpassing Indonesians as the second-largest group of foreign home buyers, after Malaysians.
In 2007, the Chinese accounted for seven percent of foreigners acquiring homes in Singapore.
“There’s a very large pool of Chinese buyers who need properties in Singapore for school, for coming here to work, for immigration purposes. All these are a natural consequence of the efforts Singapore has put in to promote ourselves in China,” said Mr. Ku Swee Yong, CEO of International Property Advisor.
Some analysts believed that foreign buyers could have a negative impact on Singapore’s property market if they sell their properties quickly, but many said that the current level of foreign acquisition was not worrying.
Ms. Chua Chor Hoon, Head of Southeast Asia Research at DTZ, noted that “Singaporean buyers still make up about 70 percent of buyers. Even if the foreigners were to pull out, it’s not going to cause a big drop in prices if the Singapore economy is doing well and locals still continue to buy.”
But the proportion of local home buyers is declining. URA data shows they composed 72 percent of all transactions last year, compared with 76 percent in 2009.
Meanwhile, those who are upgrading from public housing are buying smaller private apartments. In 2009, only 32 percent of buyers with HDB addresses had bought apartments smaller than 1,000 sq ft. However, the ratio increased to 41 percent last year due to high prices.
“Small units slightly under S$1 million are the only types most HDB upgraders can afford,” remarked Ms. Chua.