Tag Archives: Luxury Property

Sale of Sentosa villa scrapped after China buyer arrested

The sale of a $23.8 million bungalow along Lakeshore View in Sentosa Cove was scrapped after the would-be-buyer was arrested for her involvement in a Ponzi scheme, reported The Business Times.

In October 2015, the owners of the luxury property granted an option to purchase to Zhang Min, President of China’s Yucheng Group, the parent company of Ezubao.

She exercised the option that same month and subsequently lodged a caveat in November to register her intention to purchase the bungalow.

However, the sellers weren’t able to contact her during the purchase deadline, and Zhang cancelled the caveat in February, shortly after it was reported that she was one of the executives of Yucheng Group and Ezubao who were arrested in China for swindling investors.

Ezubao was one of China’s largest online peer-to-peer (P2P) lenders that was recently closed by authorities after it amassed 50 billion yuan (S$10.8 billion) from around 900,000 investors. The company reportedly enticed victims to invest by promising them high interest rates of between nine percent and 14.6 percent, but most of the businesses and projects they were investing in turned out to be non-existent.

Experts estimate that Zhang would have forked out a five percent deposit of the property’s purchase price (about $1.19 million), which would have gone to the sellers after she failed to complete the deal.

If the transaction had gone through, the Sentosa villa would have fetched $23.8 million ($2,775 psf), based on its land area of 8,576 sq ft.

The property fronts the Serapong Golf Course and overlooks the sea. It sits on a site with a remaining lease term of 89 years (as of October 2015).

Since the deal didn’t materialise, the bungalow’s owners are once again looking for buyers. It is owned by three siblings from Hong Kong, one of whom is a Singapore citizen, while the other two are UK citizens.

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Foreigners return to buy luxury property

Private residential properties priced above $5 million accounted for 19 percent of private homes acquired by foreigners in April, an increase from Q1 2015’s six percent, according to DTZ’s analysis of URA Realis caveat data and reported in the media.

Although the absolute volume of transactions is low, the figure is expected to rise as more caveats are lodged.

In April, seven of the 36 caveats lodged by foreign buyers of private homes were above $5 million. In comparison, nine of the 145 caveats lodged by foreign buyers in Q1 2015 were for homes priced above $5 million. The share steadily increased from a low of three percent in Q2 2014.

Lee Nai Jia, associate director of research at DTZ said: “The findings support what has been observed on the ground, where there is an increase in foreign investors displaying interest in luxury apartments.

“Despite facing higher stamp duties to buy properties in Singapore, foreign investors continue to be drawn to the republic’s transparent property market. There is also more smart money flowing in, as investors scour for value-for-money properties.”

According to George Tan, senior director at Savills Residential, “A good proportion of buyers are foreigners including PRs (permanent residents). Many of them are China buyers who are Singapore PRs.”

In agreement, Joseph Tan, executive director (residential) at CBRE stated: “PRC citizens with Singapore PR – that is one of the most common buyer profiles in the high-end market now.”

Majority of the said buyers may have also looked at Hong Kong.

“Singapore and Hong Kong have introduced similar sort of property cooling measures. However, the Hong Kong market, which has seen a rebound in home prices over the past one and a half years, is now looking toppish. In comparison, Singapore property, following price declines, offers better value,” said CBRE’s Tan.

DTZ’s analysis of URA Realis caveats data downloaded on 14 May shows that China buyers are flocking to District 10 again. Notably, 17 percent of the 48 private homes bought by China buyers last month were located in District 10, up from seven percent in Q1 2015 and 10 percent in the previous quarter.

Looking ahead, Savills’ Tan expects the promising recovery of foreign buying in the luxury residential market to continue.

“Prices are still at a low point and there are a lot of savvy, rich people on the lookout for good investment opportunities to take a position just before the market turns. This is the correct time for the rich (to enter the market),” he shared.