Friday, November 25, 2011

Singapore private home sales fall 24.5% in Q3 2011

Private home transactions in Singapore declined 24.5% in the third quarter of 2011 compared to the second quarter of the same year.[1] This is based on the analysis of Urban Redevelopment Authority's REALIS system conducted by DTZ. The fall in property investment was sharper, according to DTZ, investment deals in properties in Singapore fell 55% in Q3 2011 compared to Q2 2011.[2]

The fall would be more dramatic if mainland Chinese did not go on a property bubble mission as did Japanese in 1980s. Percentage and number of Singaporean buyers are declining every month but percentage of mainland Chinese buyers are increasing fast:

"THE share of mainland Chinese buyers of private homes among all non-Singaporean buyers hit a record high in the third quarter, as property-cooling measures in China drove home hunters here.

A report by DTZ Research said the Chinese bought 30.6 per cent of the private homes sold to non-Singaporeans between July and September, up from 26.1 per cent in the second quarter.

Singaporeans still made up the majority of buyers, with 64.8 per cent of all private home sales in the third quarter made to locals. But this is a drop from 67.9 per cent in the previous quarter."[3]

Saver punishing high inflation - low interest rate environment as well as the lack of innovation to channel artificially huge amount of money earned by Chinese thanks to Western debt driven over-spending, directed many Chinese to bury their money into a property bubble. Cooling measures as well as lack of private property rights in China is forcing many Chinese out of China to shop for properties overseas, including Singapore.

According to DTZ, number of private homes purchased by Singaporeans has fallen to 4,279 units in Q3 2011 from 6,167 units of Q2 2011. And number of private homes purchased by Singaporean PRs has fallen to 919 units in Q3 2011 from 1,257 units of Q2 2011. Meanwhile, number of private homes purchased by foreigners has fallen to 1,233 units in Q3 2011 from 1,449units of Q2 2011.[4]

Singapore private property sold per quarter per buyer nationality
Source : [4] 
[1] - Private home sales fall 24.5% in Q3: DTZ
[2] - DTZ Research: Investors in real estate more cautious in Q3 2011
[3] - Share of mainland Chinese buyers of Singapore private homes rises
[4] - Subsales lose their pull, especially with foreign buyers, The Business Times.

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