In the heyday of real estate in 2013, foreigners were often denounced as the driving force behind inflation. Today, with an additional buyer’s stamp tax (ABSD) for foreigners of 20 percent, foreign owners are at a 17-year low (as of 2020).
But there have recently been pieces circulating with headings such as:
Which seems to be at odds with the numbers. Still, it doesn’t stop buyers and investors from wondering if foreigners will be coming back. This brings in both potential buyers and higher property prices. Here’s a look at the numbers:
What percentage of the real estate is bought by foreigners?
From 2010 until today we have combed through private residential properties district by district. Here is the percentage of foreign owned properties we found:
1. Core Central Region (CCR)
Historically, this is the most popular region among overseas buyers. The CCR saw a boost from Chinese buyers in 2019, particularly in the luxury market. However, this has been falling since the 2020 pandemic.
Note, of course, that 2021 is not over yet, so things may still change towards the end of the year (more high-end product launches are pending).
Note that the data for District 6 is not available
| year | District 1 | District 2 | District 9 | District 10 | District 11 |
| 2010 | 18 percent | 12 percent | 28 percent | 16 percent | 17 percent |
| 2011 | 36 percent | 13 percent | 36 percent | 21 percent | 23 percent |
| 2012 | 20 percent | 11 percent | 18 percent | Eight percent | 12 percent |
| 2013 | 29 percent | 10 percent | 21 percent | 15 percent | 10 percent |
| 2014 | 22 percent | 23 percent | 19 percent | Nine percent | 11 percent |
| 2015 | 28 percent | 13 percent | 14 percent | 13 percent | Seven percent |
| 2016 | 21 percent | 15 percent | 11 percent | Six percent | Four percent |
| 2017 | 20 percent | Six percent | 11 percent | Six percent | Six percent |
| 2018 | 31 percent | 10 percent | 14 percent | Six percent | Three percent |
| 2019 | 37 percent | Eight percent | 17 percent | 14 percent | Five percent |
| 2020 | 22 percent | 13 percent | 13 percent | Nine percent | Three percent |
| 2021 | Nine percent | 14 percent | Four percent | Nine percent | Nine percent |
2. Rest of the Central Region (RCR)
The RCR has long been preferred by landlords and combines a lower quantum with a still high level of rentability. A wide range of expatriate workers rent in this area: the rental prices are not as exorbitant as the CCR, but the difference in travel time is only a few minutes.
As of late 2020, the RCR appeared to be a leading perspective for those focused on rental strategies.
| year | District 3 | District 4 | District 5 | District 7 | District 8 | District 12 | District 13 | District 14 | District 15 | District 20 |
| 2010 | 21 percent | 22 percent | 11 percent | 14 percent | 21 percent | 12 percent | Four percent | Six percent | 11 percent | Eight percent |
| 2011 | 30 percent | 26 percent | 14 percent | 30 percent | 24 percent | 21 percent | Six percent | 19 percent | 16 percent | 18 percent |
| 2012 | 10 percent | 12 percent | Six percent | 14 percent | 10 percent | Nine percent | 11 percent | Five percent | Four percent | Nine percent |
| 2013 | Nine percent | 13 percent | Five percent | 14 percent | 14 percent | 14 percent | Seven percent | Seven percent | Eight percent | Seven percent |
| 2014 | 10 percent | 16 percent | Six percent | 14 percent | Nine percent | 11 percent | 13 percent | Six percent | Six percent | Five percent |
| 2015 | 11 percent | 14 percent | Seven percent | 19 percent | Seven percent | Seven percent | Three percent | Six percent | Four percent | Four percent |
| 2016 | Seven percent | Eight percent | Five percent | Seven percent | 19 percent | Five percent | Four percent | Four percent | Five percent | Two percent |
| 2017 | 10 percent | 10 percent | Four percent | Nine percent | 15 percent | Six percent | Four percent | Four percent | Four percent | Two percent |
| 2018 | Seven percent | 11 percent | Two percent | 24 percent | Four percent | Six percent | Four percent | Three percent | Four percent | Two percent |
| 2019 | Six percent | 10 percent | Five percent | 24 percent | Six percent | Three percent | Seven percent | Four percent | Four percent | Three percent |
| 2020 | Six percent | 12 percent | Three percent | Eight percent | Three percent | Two percent | Three percent | Two percent | Three percent | Two percent |
| 2021 | Six percent | Four percent | Five percent | Zero percent | Five percent | One percent | Three percent | Three percent | Three percent | One percent |
3. Outside the central region (OCR)
While foreign owners are rare in OCR, this is likely to change in the coming decades.
This would be a result of the gradual decentralization of Singapore, creating business parks and technology centers in places like Changi Business City, the Punggol Digital District, and Woodlands Northshore.
Currently, there are likely a handful of overseas property owners working in OCR near these hubs. However, there are also some foreigners who prefer the differences in lifestyle (e.g. on the beach along the east coast or near the Katong area).
| year | District 16 | District 17 | District 18 | District 19 |
| 2010 | Nine percent | Three percent | Seven percent | Five percent |
| 2011 | 19 percent | Six percent | 12 percent | Eight percent |
| 2012 | Seven percent | Two percent | Three percent | Three percent |
| 2013 | Six percent | Six percent | Four percent | Five percent |
| 2014 | 11 percent | Four percent | Six percent | Seven percent |
| 2015 | Seven percent | Four percent | Seven percent | Three percent |
| 2016 | Six percent | Six percent | Three percent | Three percent |
| 2017 | Three percent | Four percent | Two percent | Three percent |
| 2018 | Four percent | Three percent | Four percent | Three percent |
| 2019 | Two percent | Two percent | Two percent | One percent |
| 2020 | One percent | One percent | Two percent | One percent |
| 2021 | Three percent | Two percent | One percent | One percent |
| year | District 21 | District 22 | District 23 | District 25 | District 26 | District 27 | District 28 |
| 2010 | 10 percent | Nine percent | Eight percent | Six percent | Six percent | Four percent | Two percent |
| 2011 | 17 percent | 19 percent | 12 percent | 18 percent | 10 percent | Seven percent | Three percent |
| 2012 | Six percent | Five percent | Six percent | Four percent | Two percent | Two percent | Two percent |
| 2013 | Five percent | Six percent | Nine percent | Two percent | Four percent | Three percent | Zero percent |
| 2014 | Four percent | Seven percent | Eight percent | Three percent | Zero percent | Two percent | Eight percent |
| 2015 | Five percent | Four percent | Three percent | Two percent | One percent | Three percent | Three percent |
| 2016 | Five percent | Four percent | Two percent | Zero percent | Three percent | Three percent | Zero percent |
| 2017 | Five percent | Two percent | Two percent | Zero percent | Two percent | Two percent | Zero percent |
| 2018 | One percent | Seven percent | Four percent | Six percent | Two percent | Three percent | One percent |
| 2019 | Five percent | Four percent | Two percent | Five percent | Zero percent | One percent | One percent |
| 2020 | Three percent | Three percent | One percent | Three percent | One percent | Zero percent | One percent |
| 2021 | Two percent | One percent | Five percent | Two percent | Two percent | Zero percent | One percent |
General Patterns of Foreign Ownership from 2010 to Present
At the end of 2020, the number of overseas buyers in Singapore’s private real estate market was at a 17-year low. That year only 742 properties were sold to foreigners. This is the lowest point since 2013.
This is unsurprising as we are in the middle of a pandemic and we don’t know how long this will take (transactions are much slower to process due to travel restrictions and resale units are especially hard to sell sightseeing without them).
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Regardless of the pandemic, the brokers we spoke to felt that the “killer moment” wasn’t Covid-19. Rather, it was the ABSD that was first adopted in 2011 and further developed in the years to come.
The ABSD rates were set at 10 percent for the first time in 2011. By 2013 they had risen to 15 percent. From 2018, the rate was increased again to 20 percent. It is no accident that the timing corresponds to the “lost decade” of Sentosa Cove:
With Sentosa Cove specifically aimed at overseas buyers, this is a good example of how hard the ABSD has hit.
At the end of April 2021, Sentosa prices averaged 1,596 psf, compared to 2,239 psf a decade ago. The average home price was over $ 9 million in 2011, and today the average is $ 6.8 million.
Now Sentosa’s situation cannot be generalized to all of Singapore as it is a unique area (it is also not a business hub and only appeals to the richest buyers). But when even ultra high net worth buyers are feeling the pressure, it’s easy to understand how tough it has become for other overseas buyers.
Which counties consider foreign property?
In the past ten years, the proportion of foreign owners has decreased significantly. Even in the traditional foreigner favorites of Districts 9 (Orchard) and 10 (Tanglin, Holland V), the ratio of foreign owners has almost halved in the last ten years.
Only District 1 (Raffles Place) ended 2020 with an even higher percentage of foreign owners over the decade. This is largely in the back of Marina Bay and thanks to the introduction of properties like Marina One Residences (launched in 2018).
Going forward, it seems like District 1 could remain the leading choice. In particular, we note that the proportion of foreign property owners has actually increased from 31 to 37 percent after the cooling measures of 2018.
At the end of 2020, District 1 also had the highest proportion of foreign ownership, with almost a quarter (22 percent) of foreign-owned residential real estate.
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In the RCR, District 7 (Bugis) has now started to attract the attention of overseas buyers. This district ended 2020 with the highest percentage of foreign ownership next to District 4 (District 4 is only higher because it contains Sentosa, which is not doing as well as described above).
In particular, District 7 outperformed District 9 in terms of sheer price per square foot last year. While the momentum started with the South Beach Residences, the development of the Ophir-Rochor Corridor has kept the ball going.
There are many signs that Singapore’s business and commercial hub is gradually moving to this area. Additionally, adopting small, quantum-poor properties – like Midtown Bay and Midtown Modern – might be more palatable to overseas buyers given the high ABSD.
Although foreign ownership is at a new low, demand remains strong
Analysts and brokers were quick to remind us that the small number of overseas buyers, apart from the pandemic, is the result of deliberate policy making. It’s the ABSD that is pulling the numbers down while fundamental demand is strong.
