Juwai IQI released this statement on the outlook for foreign property buying in Singapore. Juwai IQI Group Co-Founder and Executive Chairman Georg Chmiel comments on the outlook predictions.

RECENTLY INVISIBLE, FOREIGN BUYERS ARE COMING BACK

"After largely disappearing during the pandemic, foreign property buyers are starting to come back to Singapore. The trend indicates that Singaporean real estate has lost none of its appeal during the past year and a half of closed borders.

WHY BUY AN ENTIRE BUILDING?

"Proof of Singapore real estate's appeal is the March purchase of every single one of the 20 apartments in a super-lux apartment building called Eden for US$217 million (S$293m). The snack-food Tsai family, one of the wealthiest in Taiwan, did that transaction.

"In the first half, foreign buyers bought 119 Singapore properties in the $10m or more price range. (Knight Frank) That means first-half $10m+ sales closed at more than four times the rate of H1 2020 when just 28 closed, and 2019 (when just 29 closed).

"Singapore is like Switzerland in the Pacific. It is safe, stable, prosperous, sophisticated and low- tax. What's more, property values are supported by limited land supply. You may not obtain the highest yields on rental property. In the long run, very few people regret having purchased property there.

"Covid sharply cut foreign participation in Singapore market. You still had sophisticated buyers and those already familiar with the city willing to purchase from abroad using virtual tours, video calls and digital signatures. Most buyers, however, didn't fall into this category.

"Now, people sense that the pandemic-imposed border closures will ease within the near future. Foreign buyers who want to beat the post-pandemic boom feel that now is a safe time to buy. They worry that if they wait much longer, the rising tide of foreign buyers will push prices up or reduce their choices.

"Our Singapore partner OrangeTee & Tie reported that, in 2020, sales of Singapore apartments to foreigners hit its lowest point in 17 years. Foreigners bought just 742 apartments last year.

"Prices are already climbing, and many foreign buyers feel they will rise even further in 2022. They think this might be their best opportunity. If they wait any longer, they may have to pay much more.

"Private resale condo transactions jumped 11% in the second quarter. More private non- landed homes sold in the seven months to July than in all of last year or the year before.

MAINLAND CHINESE BUYERS WILL DOMINATE IN 2022

"Mainland Chinese have long been the most active foreign buyer group in the Singapore market. We feel that Chinese buyers will be back in strength in the last quarter of 2021 and 2022. We are already hearing from our network of buyers that Singapore is in their sights.

"Chinese will outnumber all other buyer groups next year. Investors are seeking greener pastures. In China's Tier 1 cities, prices are down and look unlikely to recover in the next few years. New home sales are faltering. In Shenzhen, for example, prices are down by 15 per cent compared to six months earlier.

HONG KONG BUYER ACTIVITY WILL CLIMB AT LEAST 25%

"For Hong Kong buyers, Singapore is a safe, close and transparent market where they can diversify their investments and hedge their risks. We expect residents of Hong Kong to increase their purchases in Singapore by at least 25 per cent in the first quarter after direct travel becomes possible.

MALAYSIAN BUYERS HURT BY RAIL CANCELLATION BUT WILL RETURN

"Malaysians are active buyers in Singapore. This trend took a hit after the high-speed rail connection was put on hold. Malaysian investors had put money into land and homes on both sides of the border near the expected rail infrastructure. Many lost money, and others lost the chance to make a significant markup on their investment.

"When borders reopen, expect Malaysian acquisitions of residential real estate in Singapore to begin climbing."

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