S’pore drops 3 spots in survey of top real estate investment markets

Singapore appears to be losing a bit of its shine as one of Asia Pacific’s top real estate investment markets.

It slipped three notches among Asian markets in PwC’s latest survey on where institutional investors prefer to put their money next year.

Singapore was ranked number two last year. But it was placed number five among 20 cities in the latest report by PricewaterhouseCoopers (PwC).

Shanghai was the top Asian city for real estate investment, according to the annual survey. It jumped from fifth place last year to first, ahead of Hong Kong, Beijing, Seoul and Singapore.

The survey said this is due mainly to the Chinese government’s decision to inject liquidity into its economy with its massive economic stimulus package. This helped to boost lending and led to a sharp rebound in commercial property prices.

The survey polled more than 270 industry players around the world. It found that concern about softening property values next year due to over-supply dented Singapore’s ranking among developers.

Among the real estate sectors in Singapore, residential investments came up tops in the survey. It attracted a ‘buy’ recommendation from 37% of respondents.

Another 45.1% of respondents gave a ‘hold’ recommendation on residential properties in Singapore, also the lowest recorded among all other types.

However, the survey highlighted some caution as well due to the expected volatile nature of the Singapore market. PwC told MediaCorp that respondents were uncertain about how the residential market will pan out in Singapore next year.

Going forward, the report expects real estate investments in Singapore to pick up momentum, boosted by the transparency of its market.

Despite the bullish atmosphere, market watchers believe it will largely be a slow and steady recovery for the region.

Stephen Blank, senior resident fellow at Urban Land Institute, said: “2010 is going to be a long year, we’re not going to have a sudden victory or surprises. The Asia Pacific region is expected to grow at a rate faster than the rest of the world (but) not as fast as it did in 2007…

“It will be a leading economy again. It should present excellent opportunities from a global perspective. It’s going to be a long year, we’re going to have to work hard. But I think for people who invested in the Asia-Pacific region, they are going to be rewarded.”

Source : Channel NewsAsia – 9 Dec 2009

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