Affluent hunters of residential property are seeking investment opportunities abroad to diversify their portfolios and take advantage of the strengthening Singapore dollar.
The Singapore dollar has risen considerably against the three major currencies – the US dollar, euro, and British pound – since the crash of Lehman Brothers in Sept 2008. The local dollar has gained over 11 per cent against the greenback, 14 per cent against the euro, and 25 per cent against the British pound.
Analysts say that a growing number of the Singapore affluent are looking to buy properties in global cities such as London, largely as investment assets, as local property prices have risen sharply in the last two years. In contrast, overseas property markets in major Western cities such as New York have seen a slump in prices, making them attractive.
The property market continues to be a popular investment for many in Asia as it is seen as a stable asset class that generates relatively high returns.
“London is still deemed as an aspirational city by the world’s wealthiest, richest families and as an investment target or city, it is really quite attractive because of its stability”, said Ms Phang Lah Hwa, Head of Consumer Secured Lending at OCBC Bank.
In August 2010, OCBC responded to requests from its high-net worth customers to take out the option of either Singdollar or pound-denominated loans on London property. The bank plans to roll out similar schemes for property markets in Australia and the United States in the near future.
Source : Today – 15 Mar 2011