Singapore: General market overview

Singapore is one of the most vibrant and energetic city-states in the world. As a thriving financial centre in South-East Asia, Singapore has emerged as one of the world’s most attractive real estate markets to invest in, especially given its limited land supply, transparent legal and land ownership system and stable political environment. Notwithstanding the relatively high prices of real estate in Singapore, we expect investors’ attraction to the Singapore real estate market to continue, supported by the following observations:

The residential property market in Singapore has been on an up-trend following strong interest and record bids by developers in Government land sales as well as the collective sales of existing developments from 2017 through to 2018. Consequently, as part of an effort to curb fast-rising prices, in July 2018, the government introduced the latest round of property cooling measures, raising the additional buyer’s stamp duty rates and restricting the loan-to-value limits for property loans across the board. The impact was felt almost immediately with residential collective sale transactions almost coming to a halt.

In the industrial property sector, prices and rentals remain relatively stable. New supply of industrial space is expected to taper in the next few years, as prices and rentals continue to stabilise in tandem with occupancy rates. A large portion of industrial property in Singapore is regulated by the Government, typically on 10 to 30 year leases. JTC Corporation is the main statutory board regulating Government industrial property leases.

The office leasing market has witnessed growth in alternate segments such as co-working spaces as more companies, particularly start-ups and entrepreneurs seek such facilities as an alternative to renting or owning their own office spaces. Some of the oft-cited benefits include increased networking and business development opportunities as well as cost savings through the sharing of resources, although the net rental costs are not necessarily lower.

Overall, the atmosphere in Singapore property market in 2019 will be impacted by global events and investor sentiments, including the impact of the US-China trade war, Brexit and rising interest rates.

Updated on 1 February 2019.

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