ST : China buyers are tops in Sentosa Cove

Aug 24, 2010

China buyers are tops in Sentosa Cove

They form biggest group of foreign purchasers there this year; many snap up landed homes

By Joyce Teo

BUYERS from China now comprise the largest group of foreign buyers in the exclusive residential enclave of Sentosa Cove.

In the first half of this year, Chinese buyers accounted for nearly a third of all foreign buyers - well up from 18 per cent for all of last year and just 7 per cent in 2008, according to a new DTZ report yesterday.

Malaysians were the largest group at the gated community last year, and Indonesians held the title back in 2008, the property consultancy said.

The buying surge from China is even more dramatic for landed homes there. When purchases of landed homes in the Cove were tallied up, China buyers accounted for a hefty 60 per cent (12 deals) of all foreign buyers there in the first half of the year, up from 38 per cent (nine deals) for all of last year.

Chinese buyers have shown a clear preference for the landed homes, which tend to be more expensive than apartments there.

DTZ said this is because the place offers them the opportunity to own landscaped grounds with waterfront facing in a resort-style living environment, and at prices lower than similar properties in mainland China and Hong Kong.

Chinese buyers' share of total foreign purchases across Singapore rose to 17 per cent in the first half of the year, from 7 per cent in 2006. Foreigners include Singapore permanent residents (PRs).

But overall, they are still No. 3 among foreign buyers here, after Indonesians in second place and Malaysians at the top.

Malaysians and Indonesians accounted for around 22 per cent and 18 per cent respectively of total deals by non-Singaporeans in the first half of this year.

Still, foreign buyers, not including PRs, are certainly not rushing into the market here. Their share of total deals in the second quarter was stable at 11 per cent. They remained cautious, owing to slow economic growth in the United States and Europe, said DTZ.

Singaporeans accounted for a higher proportion of private home purchases in the second quarter, at 74 per cent of total deals, up from 71 per cent in the first quarter, it said. Meanwhile, Singapore PRs accounted for 13 per cent of total deals in the second quarter, down from 15 per cent in the first, while purchases by companies were unchanged at 2 per cent.

China buyers have made headlines with some notable purchases recently, such as the $36 million purchase of a Sentosa Cove bungalow in June this year. DTZ said this is largely due to their increasing wealth and mobility on the global scene. They are also attracted to the transparent and well-regulated Singapore market.

Also, many in China come to Singapore to work, or they want their children to study here, because of the relative ease of adjusting to the culture and the bilingual environment in Singapore. This may lead them to buy homes, to live in or for investment, said DTZ head of South-east Asia research Chua Chor Hoon.

Rising real estate prices and property purchase curbs in China have also motivated its citizens to look to overseas markets for diversification and investment opportunities, Ms Chua said.

Savills Singapore prestige homes and investment director Steven Ming said Singapore is the main Asian market Chinese buyers are keen on, though they are also looking at markets elsewhere, such as Britain.

'The Chinese buyers are still active. Some of them are now in the market looking for bulk purchases of condominium units,' Mr Ming said.

The DTZ report said that when it comes to non-landed homes, Chinese buyers generally prefer districts 15, 16 and 23.

Singapore PRs from China generally like homes in districts 22 and 23 such as Jurong and Choa Chu Kang as they are near a number of their workplaces.

On the other hand, well-to-do Chinese buyers are attracted to prime districts 9, 10 and 11 as well as waterfront areas in Sentosa Cove and district 15 in the east.

joyceteo@sph.com.sg