Lunar New Year is the most important festival in the Chinese calendar, but instead of traditional reunion dinners, some families have another ritual: luxury apartment shopping in Singapore.
With the political unrest in Hong Kong showing no signs of stopping, Chinese buyers are zeroing in on Asia’s other major financial center, doubling sales of units at the top end of the market. Rich foreigners are largely undeterred by the higher taxes that are now levied on them.
Inquiries in the lead up to Lunar New Year typically jump at least 15 percent, three property agents canvassed by Bloomberg said. Demand has intensified over the past two years with most people wanting to buy units as an investment rather than a principal place to live.
“Wealthy mainland Chinese are seeking a way to safely diversify and guard a portion of their wealth in offshore assets,” said Georg Chmiel, executive chairman of China-based property portal Juwai.com (居外網).
Chinese nationals are set to top Singapore’s list of foreign buyers in seven out of the past 10 years, according to List Sotheby’s International Realty analysis of government data. In the early years of the last decade, they bought homes to resettle in the city-state, but since 2017, an increasing number are purchasing apartments solely to park their wealth and are not keen on renting them out either, agents say.
Earlier this month, Clarence Foo (符策銘), a Singapore-based realtor at APAC Realty Ltd unit ERA, sold one property to such a buyer. The Chinese couple in their 50s run their own financial business and were in town for three days to apartment hunt.
After viewing four units in the central business district, they settled on a S$3 million (US$2.2 million) three bedder at the upscale Marina One Residences, a 10-minute walk from the iconic Marina Bay Sands casino, hotel and entertainment complex.
“They just wanted a place close to the hotel because they believe property prices will appreciate quickly since it’s near a landmark location and that area is slated for further redevelopment,” Foo said.
Hong Kong used to be a favored destination due to its proximity to mainland China and fewer market restrictions, but the protests have prompted many to turn to Singapore as an alternative investment haven, drawn by its economic and political stability.
“Whereas a year ago they were enthusiastic, mainland buyers today are cautious or downright skeptical,” Chmiel said. “Either they’re postponing their purchase in Hong Kong or deciding against it altogether.”
The Chinese couple, who own four other properties in China and Canada, sold their Hong Kong apartment when violence escalated, Foo said. The pair declined to be interviewed, while Foo declined to reveal their personal details.
Cooling measures levied by Singapore’s government in July 2018 made it more expensive for foreigners to buy property in the city-state. But the curbs have impacted cheaper units the most: Sales to Chinese buyers of apartments S$5 million or more doubled in the third quarter of last year from the same period of 2018.
“It shows that high-net-worth individuals are less affected by the cooling measures than those seeking to buy lower and mid-tier apartments,” said Christine Li (李敏雯), head of research for Singapore and Southeast Asia at Cushman & Wakefield PLC.
And while China has tightened capital controls to crack down on money leaving the country, the rich, it seems, can still find a way around things.
With many owning businesses overseas, they’re often able to fund their acquisitions through those channels, according to Justin Tang, the head of Asian research at investment and advisory group United First Partners LLP.
China also operates an annual quota system whereby individuals can in some circumstances take US$50,000 out of the country over a 12-month period. It is common for relatives to pool their quotas, so much larger amounts can be transferred.
Home prices in Singapore have also moderated, making buying an apartment more affordable. Private home prices rose just 0.5 percent in the final quarter of last year compared with a 1.3 percent expansion the previous three months. For all of last year, apartment prices on the island increased 2.7 percent, well below a jump of 7.9 percent in 2018.
Singapore has “done well economically, which could also result in additional benefits such as long-term price appreciation,” Li said.
BULK PURCHASE: The French chain and Hong Kong-based Dairy Farm International reached a deal covering 224 stores, which is expected to be finalized by year’s end Carrefour SA yesterday announced it would acquire Wellcome Taiwan Co (惠康百貨) for 97 million euros (US$108.33 million), and bring all the Wellcome supermarkets (頂好超市) and Jasons Market Place stores nationwide under its banner within 12 months of the deal closing. The France-based hypermarket chain reached an agreement with Hong Kong-based Dairy Farm International Holdings (牛奶國際控股), the pan-Asian retailer that launched Wellcome Taiwan in 1987. The transaction involves 199 Wellcome supermarkets, which have average sales areas of 420m2 and 25 high-end Jasons Market Place stores, which have an average sales area of 820m2, as well as a warehouse in Taoyuan, Carrefour Taiwan (家樂福)
‘ONE-STOP SHOP’: A Miaoli official said that the factory in the Jhunan section of the Hsinchu Science Park would create more than 1,000 jobs and boost prosperity A new high-end IC packaging and testing plant planned by contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) in Miaoli County is expected to start operations in the middle of next year, Miaoli County Commissioner Hsu Yao-chang (徐耀昌) said. Hsu wrote on Facebook that TSMC, the world’s largest pure wafer foundry operator, would invest NT$303.2 billion (US$10.1 billion) to build the plant, the largest-ever single investment in Taiwan. However, TSMC declined to disclose the financial terms of the deal, while a company board meeting on May 12 approved a spending plan worth NT$168.2 billion as part of its investment plans. Construction of the
SCATTERED: Production would be dispersed among a number of countries, which would bring an end to so-called world factories, Hon Hai chairman Young Liu said Decentralized production would be the new focus in manufacturing, Hon Hai Precision Industry Co (鴻海精密) chairman Young Liu (劉揚偉) yesterday told an online forum held by the Market Intelligence & Consulting Institute (MIC, 產業情報研究所). “The COVID-19 pandemic exerted a heavy impact on supply chains as well as production ... [production] would no longer be concentrated in solely one country, this is the end of what we used to call world factories,” Liu said during a panel discussion hosted by MIC director Victor Tsan (詹文男). As the US and China continue to dominate and sway international relations, the rest of the world is
PLANNED OUT: The government is lifting sale and export restrictions on 60% of the 20 million masks made daily, but people can still make purchases using their NHI cards Twenty thousand boxes of 50 masks each would be on sale at FamilyMart convenience stores starting tomorrow, Taiwan FamilyMart Co Ltd (全家便利商店) said yesterday. A box of 50 masks would cost NT$249 for those with FamilyMart memberships and NT$299 for those without, with no limits placed on how many boxes a person can buy, the company said. Convenience store chain operator Hi-Life International Co Ltd (萊爾富) said that it would also start selling masks from tomorrow. It has yet to announce details about prices and quantity. Hypermarket chain operator Carrefour Taiwan (家樂福) said that it would start selling packs of five