SINGAPORE — Australian developers are increasingly targeting Singaporean investors seeking residential properties overseas as repeated rounds of tightening measures restrict investment opportunities at home.
Companies including Australia’s largest property developer Lend Lease as well as Crown International Holdings will roll out marketing campaigns in Singapore in the near future for their housing projects in Sydney, Melbourne, Brisbane and the Gold Coast. They will offer apartments and houses ranging from A$500,000 (S$637,000) to several million Aussie dollars each.
Australia is especially appealing to Singaporeans because of its proximity and familiarity.
Singapore is Australia’s sixth-largest tourism market, with more than 300,000 visitors annually. There are about 50,000 Singaporeans living in Australia, including 10,000 students, Prime Minister Lee Hsien Loong said at an official dinner in April last year in honour of Australian Prime Minister Julia Gillard. Singapore is also Australia’s largest trade and investment partner within the Association of South-east Asian Nations and its fifth-largest investor.
Mr Guy Pahor, Frasers Property Australia’s CEO, said Singaporeans formed the second-largest group of offshore buyers for his company.
Some buyers choose to purchase properties for their children studying in Australia while others buy purely for investment.
Australian real estate is seen as more affordable than in Singapore, where private apartments and condominiums are priced out of the reach of many. Even resale public housing prices have hit the roof.
For the price of a Housing and Development Board flat, buyers are able to choose from a wider range and category of real estate in different cities and locations in Australia, property agents said.
Singaporeans tend to favour quality apartments priced from A$500,000, said Mr Haig Conolly, Crown’s Director of Sales and Marketing, adding that they typically “look for returns of 4 to 5 per cent from their investments”.
Singapore investor interest comes even as the Australian property market sends out mixed messages about its fortunes. Property prices across Australia’s eight major cities fell 0.4 per cent to an average of A$483,000 last year after dropping 3.8 per cent in 2011, according to property research company RP Data. They have since risen 2.8 per cent in the first quarter, it said.
In Melbourne, prices and rents have fallen by an average of 5 per cent in the past year with no immediate prospect of that bottoming out, said Dr Andrew Wilson, Senior Economist with industry research firm Australian Property Monitors.
“Melbourne developers are offering discounts and other incentives to induce buyers,” he said.
Over on the Gold Coast, a popular holiday destination with good tourism infrastructure and an established market for holiday lettings, investors can “expect returns of 5 to 6 per cent” for “an entry price of A$300,000 to A$400,000”, he added.
South-east Asian buyers, including those from Singapore, bought about A$250 million worth of residential real estate on the Gold Coast over the past year, said Mr Matthew Cassidy, Residential Property Manager (Project Market) with Knight Frank Australia. Between 20 and 25 per cent of new inquiries are from Singapore, he added.
In Sydney, the most populous city in Australia, the market has traditionally been more resilient because of its size and a shortage of rental accommodation, said Dr Wilson.
“Investors have always been able to see a solid yield of 5 to 5.5 per cent on apartments and houses,” he said, adding that prices rose 4 per cent last year and were expected to rise by up to 7 per cent this year.
Source : Today – 2013 May 3