S’pore returns to top 20 list of most expensive cities for expats
Singapore has once again returned to the top 20 list of most expensive cities for expats, reported Channel NewsAsia citing a survey...
More redevelopment deals and increased foreign buying interest is expected to drive demand for Singapore homes.
Fuelled by redevelopment deals and an increase in foreign buying, UOB Kay Hian expects home prices in Singapore to bottom out this year and climb by five to 10 percent in 2018, reported Bloomberg.
This comes even as the government has kept most of the property cooling measures in place.
Earlier this month, Morgan Stanley also predicted home prices to increase by two percent this year and 10 percent by end-2018.
“We foresee the nascent recovery spreading to the mid-range and high-end segments in the next wave, driven by replacement demand from redevelopment of old housing projects and a pick-up in home-buying interest from foreigners,” said Vikrant Pandey in a note.
This year’s redevelopment deals, which see homeowners in older buildings sell their apartments to developers, have exceeded the combined transaction value for the past four years at $3 billion. Armed with the money from these redevelopment sales, he expects these buyers to drive the demand for mid- to high-end homes.
Despite the 15 percent Additional Buyer’s Stamp Duty imposed on foreigners, Pandey also expects foreign buying to increase as other overseas destinations have introduced their own measures to cool foreign demand.
Hong Kong has doubled its stamp duties on foreign property buyers to 30 percent – exceeding that of Singapore, while Taiwan levied a punitive divestment-gains tax of up to 45 percent in January last year. Canada and Australia have also raised their transaction costs for foreign buyers.
Pandey noted that the levelling of taxation costs is making Singapore property more appealing for foreign investors.