Singapore is fifth on the list of preferred destinations for Chinese investors looking to invest in fixed assets such as property.
Singapore rising in popularity amongst Chinese investors
Arena Residences, Condo.
Despite the rapid rise in property prices over the past decade, Singapore’s land and property prices are perhaps still low in comparison to larger cosmopolitan cities in countries such as the United States, United Kingdom and Australia.
Hong Kong is also ahead in terms of the speed and rate of increase in property prices.
A recent survey showed that 14% of property investors from China have plans to put their monies in Singapore’s property sector this year.
This is more than the 10% investor-intention in Germany and 6% each in Canada and New Zealand.
While the US, UK and Australia are still capturing most of the Chinese investment funds globally, one must take into consideration the size of their country and the availability of land.
Perhaps in the top 5 countries on the list, Hong Kong is the best comparison to Singapore. The former is still a preferred location for Chinese property investors partly due to its proximity and the vibrancy of their property market.
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Will Singaporeans be able to cope with continued rise property prices?
Chinese investors acquired a total of 4 deals last year to the tune of US$650m.
Some of the largest investments made by the Chinese last year included the acquisition of Goodluck Garden by Perennial Real Estate and Qingjian International for US$441 million.
Goodluck Garden. Picture: Knight Frank
However, as much as the Chinese have invested, they have more than tipped the balance in sales, especially on the back of tighter controls on capital outflow in China.
While the trade dispute may be seeing a respite soon, investors are still treading carefully as the market environment remains muted US$1.4 billion worth of assets were sold in 2018, including the sale of an office by CLSA Capital for US$517 million and the sale of an industrial site for US$426 million by REC Group.
Analysts predict sustained interest in markets popular with Chinese investors such as the US, UK, Australia and Hong Kong.
At least for now, they may be slightly tentative on investing outside of the UK, Germany and Europe, and in countries such a South Korea, Malaysia and Canada.
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