There has been a prolonged decline in Singapore’s retail, residential and office property markets, reputed global news service CNBC reported, quoting a recent report by Deutsche Bank. Consequently, HNWIs, retails investors, and family offices are exploring markets outside Singapore for long-term investments in the real estate sector.
Quoting the government data, CNBC said that private housing prices fell by3 percent in 2016, further slowing down from 3.7 percent in 2015. The prime reason for this decline in the residential market is attributed to the introduction of new measures aimed at Singaporeans owing homes and international investor.
The introduction of Additional Buyer’s Stamp Duty (ABSD) added approximately 15 percent to the purchase price for foreign buyers and Singaporeans with more than one property. Furthermore, the government introduced Total Debt Servicing Ratio (TDSR), aimed at ensuring that buyers’ monthly debt payments do not exceed 60 percent of their income. This was done to ensure them from being caught out by a spike in interest rates.
As a long-term effect, investors are exploring the London property market where the fundamentals of the real estate sector are strong. I It has been reported that in the final quarter of 2016, the number of transaction in London increased by 36% compared to the previous quarter. Moreover, the weak pound is an incentive for international investors to acquire property in London, which offers stable returns.