Indian nationals find dream homes in private resales | property

Business Times: Tue, Nov 08
(SINGAPORE) Indian citizens stand out among the major nationalities of foreigners and permanent residents buying private homes in Singapore, as they source for their homes predominantly in the resale market.

Market watchers suggest this may reflect that Indians mostly buy completed homes for immediate occupation. On the other hand, mainland Chinese, Indonesians and Malaysians make a higher proportion of their private home purchases in the new sales market from developers, pointing to a greater presence of investors and specu-vestors among their ranks.

‘Such buyers do not need a home immediately for occupation so they don’t mind buying in an uncompleted project that may take a few years to be ready,’ suggests DTZ’s head of Asia-Pacific research Chua Chor Hoon.

DTZ’s analysis of the URA Realis caveats database as of Nov 1 showed that 82 per cent of the total of 244 private homes that Indian citizens (PRs as well as non-PR foreigners) purchased in Q3 2011 were from the resale market. This percentage share was the same in the preceding quarter.

It is also roughly double that for the other three major nationalities of PRs and foreigners who buy private homes in Singapore – mainland Chinese, Malaysians and Indonesians. These three groups picked up more units from developers in the new sales market than they did in the resale market.

For mainland Chinese, who bought a total 654 private homes in Q3, 51 per cent were acquired from developers, 39 per cent in the resale market and the balance 10 per cent in the subsale market.

Resales and subsales both refer to secondary market deals – the former involves projects with Certificate of Statutory Completion, and the latter without CSC.

Malaysians purchased 407 private homes in Q3, of which 48 per cent were bought from developers, 41 per cent in the resale market and 11 per cent in the subsale market. It was almost the same split – at 49:40:11 – for the 372 units that Indonesians bought in Q3.

One reason Indians have a much higher propensity to buy from the resale market is that they are mostly looking for a property that they can occupy immediately. Jones Lang LaSalle’s head of residential and national director Jacqueline Wong says: ‘I have two categories of Indian buyers: the first comprises people working here and who have become PRs. Some of them switched to buying a residential property for their own occupation after having lived in rental premises here initially. The second category are people who don’t reside here but have some base here such as a rep office and who may visit Singapore several times a year. Or their relatives may come here for visits or holidays.

‘Both categories would much prefer to buy a completed property that they can see, inspect its finishes, and check out the views. They may be less comfortable buying an uncompleted property off-plan.’

Based on DTZ’s analysis, Indians turned to developers for only 10 per cent of their private home purchases here in Q3.

JLL’s Ms Wong says that on the other hand, Malaysians and Indonesians are more comfortable with buying off-plan (uncompleted) properties in Singapore as they have been familiar with Singapore much longer – including its rules that protect home buyers in uncompleted projects.

DTZ’s caveats analysis also highlighted that the most popular project among foreigners (excluding PRs) in Q3 – based on caveats information up to Nov 1 – was euHabitat at Jalan Eunos, followed by Thomson Grand and Seastrand.

Among PRs, the three most sought-after projects were euHabitat, Woodhaven and Seastrand.
Source: Business Times © Singapore Press Holdings Ltd

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