Foreign buyers’ share of Sentosa Cove homes on the rise

Foreign buyers’ share of Sentosa Cove homes on the rise

Proportion hits 43% in first 10 months, from 39% in ‘07-’08

By KALPANA RASHIWALA

(SINGAPORE) Foreigners, including permanent residents, picked up nearly 43 per cent of the homes transacted in Sentosa Cove in the first 10 months of this year, up from about 38-39 per cent in 2007 and 2008.

A Savills analysis of caveats data captured by URA’s Realis system also showed that buyers from ‘Western’ countries - which it defined as those from Europe, North America, South America, Australia and New Zealand - made up four out of every 10 foreign buyers in Sentosa Cove between the fourth quarter of 2004 and Q4 2009.

In that period, such buyers were more active in Sentosa Cove than in the other sought-after districts of 1, 9, 10 and 11.

DTZ executive director (consulting) Ong Choon Fah observes: ‘Buyers from Western countries appreciate the lifestyle elements in residential developments a lot more. In their home markets, units in a project that face the water or bay can sometimes be priced double that of units that don’t have such a view.’

Savills found a total of 1,297 caveats lodged for purchases of private homes in Sentosa Cove over the five-year period, of which 487 (or 37.5 per cent) were from foreigners (including permanent residents). Singaporeans bought 705 units, giving them a 54 per cent share.

In the first 10 months of 2009, 133 caveats were lodged for homes in Sentosa Cove. Of these, 57 were bought by foreign buyers, with Malaysians having the largest share of 25 per cent or 14 caveats, followed by Indonesians, UK citizens, mainland Chinese and Hongkongers.

DTZ’s Mrs Ong said: ‘What Sentosa Cove offers is very unique. It’s as close to waterfront housing as you’ll get in Singapore, plus it’s a gated community, with limited car access to outsiders. Sentosa Cove used to be like a construction yard. Now, however, most of the homes have been developed, and foreigners may be even more inclined to buy.’

The additional draw to Sentosa Cove among foreign buyers is that it is the only location in Singapore where foreigners who are not Singapore permanent residents are allowed to purchase landed property.

However, they must still seek permission from the Land Dealings (Approval) Unit under the Singapore Land Authority.

The approval time for Sentosa Cove has been specially fast-tracked to 48 hours - compared with about four weeks for applications by PRs seeking approval to buy landed homes on mainland Singapore.

Mrs Ong reckons that there is scope for the share of foreign buying to increase further next year, with the opening of the two IRs.

Also, the completion of Phase One of Marina Bay Financial Centre will strengthen Singapore’s positioning as a global business centre.

‘When high networths buy, they talk about their investments to their clique of people. That can generate further interest in Sentosa Cove,’ she says.

Steven Ming, Savills director of investment sales & prestige homes, says that foreign buyers’ presence is a critical factor for prices of luxury homes in Singapore, including at Sentosa Cove.

He says: ‘If we look back, in 2006-2007 when foreigners were buying in Singapore, luxury prices ran up quite a bit.

‘At the start of this year, there was very little foreign interest in the Singapore property market and it was mostly the mass and mid-segments that were doing well.

‘In the past few months, however, foreign interest has returned and we’re seeing a pick-up in prices on Sentosa Cove.’

Source : Business Times - 07 December 2009

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