With Covid-19 putting paid to any travel plans in the near future, Mr David Yong plans to sample the resort life at Sentosa Cove instead.
The 33-year-old bachelor has been shopping for his next home at the upscale residential enclave on Sentosa island since the beginning of the year. His budget: $10 million to $15 million.
He used to shuttle between Cambodia, South Korea and Japan for work but is now home-bound because of the coronavirus pandemic.
“Since I can’t travel, home has become an even more important place to work from and relax. Besides, I enjoy the chill resort lifestyle that Sentosa Cove provides and I have friends who live there,” said the chief executive of Evergreen Assets Management and managing partner of YSL Legal.
He lives at his family home in Goodman Road in the east but hopes to secure his Sentosa home in a few months.
Wealthy Singaporeans are still buying high-end properties, even as the overall private housing market slumped last month and in the first half of this month after strict measures to stem the viral outbreak curtailed non-essential activities.
New private home sales were down 58 per cent last month compared with March, hitting a five-year low, according to figures released by the Urban Redevelopment Authority (URA) on May 15. Only 277 private homes were sold last month against 660 in March.
The figures exclude executive condominium units, which are a public-private housing hybrid.
Of the 277 homes, 102 were properties located in Singapore’s core central region, taking up 36.8 per cent – or slightly over one-third – of the overall sales volume. This is an increase from 11 per cent last year and 6.96 per cent in 2018.
Experts say the steady sales of luxury homes – defined as those in prime areas – are remarkable but not a surprise as buyers with the financial clout see a weak economy as an opportune time to grab a good purchase.
Property analyst Ong Kah Seng said wealthy buyers are not affected by affordability, but look at the long-term returns on their property investments.
“Those who purchase during the pandemic are opportunistic buyers who are confident in the longer-term price growth after Singapore ultimately emerges from this recession,” he said.
The slight dip in prices has also motivated wealthy buyers to actively seek out potential luxury homes to purchase, he added.
MS CHRISTINE SUN, head of research and consultancy at OrangeTee & Tie, who says investors have confidence in Singapore’s ability to bounce back after a crisis.
Prices of landed properties and luxury condominium units in the core central region decreased by 0.9 per cent and 2.2 per cent, respectively, in the first quarter of this year, according to the URA’s real estate statistics released on April 24.
Mr Lester Chen, senior division director at Singapore Realtors Inc (SRI), said: “People turn to property during this time because their money will depreciate during a recession. Stocks are also dangerous.
“If you buy a property at a good price and hold on, when the market goes up, hopefully in three to four years, you can sell it.”
Mr Chen, who specialises in luxury properties in Sentosa, Marina Bay and Orchard, said he has about 100 potential buyers shopping for homes at the moment. Some have even handed him cheques so that he can snap up the ideal condominium unit the moment it is available.
For some popular luxury developments like Marina One Residences, sought-after units such as those on the higher levels with a good view can be sold in 30 minutes, he said.
A curb on in-person property viewing during the circuit breaker has not deterred some buyers.
SRI managing partner Bruce Lye sold a good class bungalow (GCB) to a Singaporean businessman for $21.68 million, or $1,028 per sq ft, last month. The buyer made the purchase after looking only at the land plans.
The property, in Windsor Park Road, off Upper Thomson Road, is one of five GCBs sold this year. There are about 2,800 GCBs in Singapore.
Mr Lye said: “When it comes to super-high-end properties like this, it’s not about the actual building but the shape of the land and its location. The buyer will probably just tear it down and rebuild it.”
Mr Lye, who has been a property agent for 15 years, said the downtime afforded by the circuit breaker may also allow busy businessmen, who are “caught up in the rat race”, to slow down and think about their housing needs.
The interest is also an indication that the ultra-rich continue to view Singapore as a safe haven to park their funds, say analysts.
Ms Christine Sun, head of research and consultancy at OrangeTee & Tie, said investors have confidence in Singapore’s ability to bounce back after a crisis.
“Although the long-term effects of the pandemic remain uncertain, Singapore’s property market has always recovered after every economic crisis,” she said.
“Private properties have generally yielded positive capital appreciation over the past 30 years and have weathered some of the toughest crises, such as Sars (severe acute respiratory syndrome), the Asian financial crisis and the global financial crisis.”
Mr Leonard Tay, head of research at Knight Frank Singapore, agrees, saying: “Historically, Singapore has always been a safe haven for high-net-worth individuals to park their investments due to its stable political environment and pro-business economy.”
While analysts agree that pent-up demand will likely boost private home sales next month when the economy gradually starts to open, some are uncertain whether the demand will be sustained in the medium to long term.
Said Mr Tay: “It’ll depend on whether additional waves of Covid-19 infections will occur and whether business activities can resume without too many prohibitive restrictions.”