Singapore's tallest condominium project will only be ready in 2009 at the earliest, but that has not stopped Asian buyers from joining the rush for one of the most prestigious addresses in town.
At least 30 percent of the buyers at the soft launch of Tower 2 of the Sail at Marina Bay were from the region, especially China, Hong Kong, Indonesia, Taiwan and India, according to developer City Developments Limited (CDL).
Fewer than 30 apartments remain unsold in the 430-unit Tower 2 where the price of a one-bedroom unit measuring 57-72m2 can set a buyer back by at least S$620,000 (US$366,864).
A bargain
But even that is seen as a bargain by some regional investors.
Property analysts said that the recovery in property prices here has lagged that of neighboring economies by 40 to 60 percent since the region was hit by the Severe Acute Respiratory Syndrome (SARS) health epidemic in 2003.
The SARS outbreak shook up the travel industry and also slowed down the economies of much of East Asia, including Singapore, six years after a regional financial crisis also hit the property sector.
"Our immediate neighbors have already run up so much [since SARS]," said Leslie Chua, the Singapore-based head of regional real estate intelligence for Jones Lang LaSalle.
`Looks attractive'
"If you look at places like Hong Kong, Bangkok and Kuala Lumpur, it's been trading very well. With all those markets running up so much, Singapore looks attractive," she added.
According to Chua's calculations, property prices in Hong Kong have shot up by 60 percent since the SARS outbreak, while in Kuala Lumpur, the increase is about 40 percent.
Prices in Shanghai, increasingly on the radar screens of investors, are up also by 40 percent, Chua said. By comparison, prices in Singapore rose by less than 10 percent over the same period, he said.
Education system
Apart from the attractive valuations, foreign buyers are also attracted to Singapore's status as a stable country and for those who are planning to send their kids to schools here, the education system, rated as one of the best in Asia, is a plus factor, analysts have said.
"We are perceived as a safe market so we will attract investors who are interested in putting their money here," Nicholas Mak, head of consultancy and research at Knight Frank property consultancy, said.
"There are some markets where it is easy to buy the property but difficult to exit," he said.
Useful investment
Mak said many Asian buyers are also planning to send their children here to study, so investing in a piece of property would be a useful investment.
A recent Jones Lang LaSalle study said that more than half of the buyers of the new residential projects in the September quarter were foreigners who went mostly for the high-end units.
According to the study, the prices of top-tier apartments at the end of June were still about 32 percent below their peak just before the 1997 Asian financial crisis.
"Singapore's luxury residential prices have remained stable in the past few years, lagging behind other major Asian cities like Shanghai, Beijing, Hong Kong and Bangkok," the study said.
Mini-boom
Things have begun to stir this year and share prices of property companies in Singapore have enjoyed a mini-boom after the government announced in July new measures to boost the market, including a relaxation of certain rules to allow foreign ownership.
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