Bulk purchases of Singapore luxury properties by individual foreigners on the rise

Bulk purchases of residential private properties in Singapore are on the rise. While most deals remain discreet, some are making the news in recent months.

Earlier in June 2022, a Chinese national is said to have bought 20 units at CanningHill Piers, a condominium along the Singapore River, for more than S$85 million..

The purchaser, who is from the Chinese province of Fujian, is also rumoured to be considering purchasing a further 10 units, bringing the total deal to above S$100 million.

Among the 20 units that were recently purchased are ten 3-room apartments that cost between S$3.1 million and S$3.3 million and ten 4-room apartments that cost between S$5.3 million and S$5.6 million.

The deal is anticipated to contribute around S$30 million in stamp duties under the new property cooling measures if the buyer proceeds to buy 10 additional units.

The additional buyer’s stamp duty for foreign buyers has increased from 20% to 30% as part of the measures put in place last year to calm the real estate market.

When CanningHill Piers is finished in 2025, it will be a component of the integrated redevelopment of the former Liang Court site which consist of a retail space, hotel and serviced apartments.

Additionally, we understand that 22 units in the Draycott Eight may be sold shortly.

Eden at Draycott Park (left) and Draycott Eight (right)

Draycott Eight is a prestigious high-end condominium project located at Draycott Park, a prime residential enclave in Singapore. The famed Orchard Road shopping and entertainment district is just a short stroll away.

An Indonesian family is doing exclusive due diligence with a view to purchasing the units from US-based private equity firm Angelo Gordon for a sum of close to S$168 million.

Based on a total stratum area of 65,401 square feet, the price comes out to somewhat less than S$2,570 per square foot, according to sources.

Bulk purchases by foreign individuals in Singapore are not uncommon.

In 2021, all 20 units at its ultra-luxury condo, Eden at Draycott Park that is near Draycott Eight were sold for S$293 million. While in 2017, an Indonesia single buyer scooped up 20 one-bedroom units at Scotts Square for a total purchase price of S$37.388 million.

Will we see more foreign individuals bulk buying condos in the near time horizon?

Yes very likely.

Singapore, a land-scarce state, regularly ranks as one of the greatest places to invest in real estate when compared to other locations. Singapore is well known for its geopolitical stability and hub position in addition to its development and investment potential. Investor confidence in Singapore is high and continues to improve thanks to constantly improving infrastructure and a stable and forward planning government.

The increased ABSD rates for both foreign and domestic investors may not be sufficient to stop high networth individuals from expanding their real estate holdings in Singapore. We see foreigners who are unafraid to enter Singapore’s real estate market, even with a 30% ABSD.

For real estate, with a long investment horizon, the cost of purchase and duties can be accrued, along with the potential of realizing good gains.

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