Research by Knight Frank has found the Singapore government's cooling measures are working. Lending restrictions, additional taxes and protection from 'hot foreign money' have indeed slowed sales figures and lowered prices.
Overall, the number of units sold to foreign buyers was down by about 76 per cent in the first quarter from the fourth quarter of last year. And even though they dwindled by a significant 55 per cent over the period, mainlanders are still among the top buyers of Singapore property.
However, Nicholas Holt, research director at Knight Frank Asia-Pacific, says prime Singapore property is still regarded as an investment safe haven for wealthy Indonesians, Malaysians, Indians and Chinese.
The prestige factor is a major draw. Singapore's Orchard Road has been named the top shopping street in the world in a survey conducted by French marketing consultancy Presence Mystery Shopping.
The city also offers political stability, security of tenure and a liquid market with solid rental returns. Even Singapore's introduction last December of a 10 per cent additional buyer's stamp duty for foreigners is considered by some high-net-worth individuals as a necessary cost to park their money in Singaporean real estate, Holt says.
Data for the second quarter from DTZ Research suggests this confidence is reflected in rental returns, which grew strongly across all segments of non-landed homes. Condominiums in suburban areas gained the most, up 1.9 per cent. Yields from prime condominiums nudged up by a smaller 1.5 per cent, following a period of no growth in the first quarter. Resale prices of private homes also gathered pace as buying sentiment returned.
Margaret Thean, DTZ's executive director (residential), says: 'Despite global economic uncertainties that have affected expatriate relocations, rents of luxury condominiums edged upwards, supported by rental demand from top-end expatriates who still have the budgets to rent luxury apartments even if there are now fewer relocating to Singapore.'
Mid-tier foreign professionals who do not enjoy housing allowances continue to support rental demand for apartments in the range of S$3,000 (HK$18,400) to S$7,000 per month.
Among new luxury projects on the market is The Lumos in District 9, located in the prestigious Leonie Hill residential area off Grange Road. Marketed through Alexis Ng of Knight Frank Singapore, its 53 executive units are encased in a 36-storey tower evolved from the concept of a glittering chandelier. Units range from one bedroom to a four-bedroom duplex and penthouse, starting from S$2,600 per square foot.
Boulevard Vue on Orchard Road is another project in the prime District 9. Offering just 28 limited-edition homes and marketed by Mark Lim of Colliers, the units are priced from S$4,154 per square foot. These lavishly appointed residences are set over 33 storeys.