SINGAPORE: Singapore may benefit from Hong Kong’s recent increase in stamp duty for overseas property buyers. According to Cushman & Wakefield, Singapore’s three-year slump in house prices could end this year as foreign investors in Hong Kong are expected to divert their attention to Singapore instead.
“The fallout from the stamp duty could be beneficial for Singapore,” said Sigrid Zialcita, Managing Director for Asia Pacific Research at Cushman & Wakefield.
“Singapore is always seen as a place where you can preserve capital and we are expecting interest from foreign nationals to come back.”
Last November, Hong Kong raised its stamp duty for overseas buyers to 30 percent, making Singapore’s 18 percent rate more favourable, especially to mainland Chinese who are looking for overseas investments to protect them from a weakening yuan.
With this, analysts expect property values in Singapore to dip by just 1.5 percent this year, while secondary home prices in Hong Kong are forecast to drop by eight percent.
Desmond Sim, CBRE’s Research Head for Singapore and Southeast Asia, expects prices to stay flat or dip by up to two percent. Savills, on the other hand, has forecast a one percent increase in average home prices.
The city-state has seen housing prices fall by 11 percent since 2013, when the government rolled out its strictest property cooling measures.