Mainland Chinese buyers of residential properties in Singapore reach record 23% in Q4 2010

The proportion of mainland Chinese buyers rose 3% in Q4 2010 from 20% a quarter ago.

According to DTZ, for the whole 2010, their proportion among non-Singaporean buyers reached a yearly high of 19%, as compared to 15% in 2009. It is the first quarter and year that they have overtaken the Indonesians to be among the top two groups of non-Singaporean buyers of residential properties in Singapore.

Ms Chua Chor Hoon, Head of DTZ South East Asia Research commented, “Mainland Chinese buyers are expected to continue to be among the top two groups of foreign buyers, as the implementation of property market curbs in China and growing wealth of the mainland Chinese will motivate more of them to make purchases overseas, including Singapore.”

The research report is based on caveats lodged for both new and secondary sales. Caveats lodged are used as a proxy for sales transactions, thus the terms 'transactions' and 'caveats' are used interchangeably in this report.

The proliferation of small units in new developments has led to an increase of units below 1,000 sq ft transacted in 2010 compared to 2009. The number of transactions for units below 500 sq ft increased by 114% while a 28% increase was seen for units between 500 sq ft and 1,000 sq ft. These increases were much more than the 11% increase in overall transaction volume in 2010.

A closer analysis showed that the proportion among buyers with public housing addresses in 2010 who bought units below 1,000 sq ft surged from 32% in 2009 to 41% in 2010. This rise is much faster than that of buyers with private addresses.

Continuing an upward trend from the previous quarter, Q4 2010 saw purchases by companies increasing to 4% from 3% in the previous quarter. These are mainly from investment funds which bought units in bulk, particularly in prime projects.

Following more measures to stabilise the residential market in January 2011, DTZ expects quieter activity in the market in 2011. According to Ms Chua, sub-sales activity is expected to be lower in 2011, as short-term speculation is affected by the seller’s stamp duty which was imposed in August 2010 and raised in January 2011.