Foreign demand to help recovery of luxury property market
Despite the 17.5% fall in foreigner’s share of purchases from 2011 to 6.2% in November 2012 as a result of the ABSD, the luxury property market is expected to recover in 2013 as foreign investors return to the local market. This is also helped by the low interest rates, the market liquidity and possibly fall in prices as a result of excess supply. Furthermore, recent cooling measures such as caps on loan tenures are unlikely to affect foreign investors can afford higher upfront payment.
While foreign purchases in the CCR fell to 495 units in Q1-3 2012 from the 1,387 units in 2011, sales volume had increased since developers are offering ABSD rebates to both locals and foreigners. In Q1-Q3, 2,109 units were sold to locals, 86% of the 2,459 units sold in 2011 while the 489 units …