Singapore Real Estate Guide – Buying Property in Singapore

Singapore’s reputation as being a safe and efficient country to conduct business has prompted an influx of foreign investors. Many of these investors have opted to take up long term residence in Singapore and prefer to invest in housing property as opposed to paying rentals.

This not only refers to accommodations for their families and employees’ but also office space, factories and warehouses. As property prices in Singapore remain relatively stable, property investments pays good dividends over time.

To buy a residential property in Singapore, it is important to understand the fundamentals of local real estate. As in all free market economies, the type of property is paramount to it’s value. The most expensive and highly sought after properties will be found in and around the shopping, business and prime residential districts across the island.

Fundamentally, all properties and land parcels either fall under the CCR (Core Central Region) or the OCR (Outside Core Region) regions as defined by the government.

Industrial Properties

Industrial properties are mainly found in the western regions of the island in the Jurong and Tuas industrial estates. The older, smaller industrial estates across the island are in the process of being phased out and shall be centralized in the west too. With the exception of high-end technology businesses, all other forms of industry shall be relocated to west.

Commercial Properties

Commercial properties are basically broken down into centralized and niche locations and fall under the business or retail sectors. The existing Central Business District is found in the southern edge of the island. Adjacent to this area, the new Central Business District is currently under construction and is projected to be completed in 2012.

Singapore

Residential Properties

The demand for luxury and quality housing has been steadily rising. Company proprietors and top level executives have a penchant for luxurious dwellings such as mansions, bungalows, prestigious condominiums and penthouses. These are found in choice locations across the business and shopping districts. Such properties offer an opulent lifestyle, as well as excellent real estate investments.

Singapore has a list of prestigious locations. Residences in Sixth Avenue, Chancery Lane and, Nassim Hill remain the most sought after properties. And while there are many other properties that are matching in lavish architecture and land area, these premier locations are where the elite of Singapore can be found. Such private homes are usually in the range of 5,000 to 15,000 square feet in built-up area alone, not counting the lavish gardens that encircle them.

And as such residences are in very short supply, the next best thing would be to look to prestigious condominium apartment complexes with a full range of amenities. Residential Properties are spread out across the island except in the western industrial estates, the reservoirs and nature reserves and the surrounding islets with the exception of Sentosa.

Foreigners who are less affluent have a variety of choices if they choose to be permanent residents here. Singapore’s public housing scheme presently offers public flats (apartments) on a build-to-order basis. These new flats are bigger than the older ones and their designs are comparable with that of private apartments.

Public housing is known as HDB (Housing Development Board) flats. They range from one-room to five-room units with land areas of between 1,000 to 1,500 square feet. These units are available for sale to both Singaporeans and Permanent Residents of Singapore at hire-purchase installments for 20 to 25 years. Public housing constitutes more than 80% of residential properties here.

Singapore - The Garden City

Factors in the Value of Property in Singapore

High value properties are those in proximity to the shopping and business districts. Another factor that determines value would be the prestige of a location. But the main factor here in Singapore is the scarcity of land. As this is a very small country, the allocation of land and its permitted uses are determined by the government. And because of this scarcity, land value across the board remains relatively stable as compared to other countries with ample undeveloped parcels of land.

Proximity to expressways (highways), MRT (Mass Rapid Transport) stations and ERP (Electronic Road Pricing) gantry gates also factor in. Properties too close to the expressways shall always have a problem with vehicle exhaust fumes and the noise of traffic, even on the higher floors of high-rise buildings. For those in favor of commuting by train, the walking distance should not only be short but also well lit up and and with covered walkways.

ERP gantry gates are installed to restrict the number of vehicles that enter the business and shopping districts by charging and entry fee for any vehicle that passes through it during peak periods of the day. Any vehicle that is parked within these districts is exempt from these fees as long as it does not leave and re-enter these districts during peak hours.

Tenure of a property or land parcel also affects value. The tenure of existing properties is dependent on its use. Industrial and commercial properties are anywhere from 30 to 99 years and residential properties are either at 99 years, 999 years or freehold. As a guide, public housing only has a 99 year tenure, private apartments and condominiums have between 99 and 999 tenures and and all landed property (houses) have a freehold tenure, unless expressly stipulated.

Amenities affect the value of apartment condominium dwellings in Singapore. Unlike other countries, an apartment condominium is seem as a prestigious property with a value that reciprocates with its location, land area and also, its amenities. A good dwelling should ideally have a swimming pool, at least one spacious function hall, a comprehensive system of integrated security, a gymnasium, tennis and squash courts, a good system of allocated car parking and, even the quality of its landscaping and design.

Scarcity of Land

Singapore property market projections are more often up than not. And as new parcels of land become more scarce, property market kingpins are now focusing on bidding for en bloc sales of old apartment buildings, condominiums, and clusters of houses. This has been a growing trend for the past few years and it doesn’t look to be going away. This is the latest strategy that developers have adopted in land-scarce Singapore where parcels of land for new developments have dwindled in recent years.

Developments like the Integrated Resort and Waterside Residences at Marina Bay have long since been tendered out to developers and are already underway. Here is where you will find some of the most opulent and prestigious dwellings anywhere in the world. Some of these properties will not only be literally next to the sea, they’ll also allow one to berth their yachts next to their living rooms. Comprehensive, state-of-the-art, fully integrated electronic surveillance systems also make this one of the safest estates in the world. All access points to this area are constantly monitored by the Singapore Maritime Authority with 24 hour patrols.

Unlike other countries where land, and other resources that stem from such land are in abundance, Singapore fully utilizes its limited land area. The majority of high-rise buildings in the CBD have their car-parks and amenities integrated into them to optimize land use. The majority of MRT upgrading projects are aimed at providing new MRT stations with ample car-parking on the outskirts of the CDB. This shall alleviate traffic both in and out of the CBD, as well as minimize the need to build more car-park lots.

Proposed Infrastructural Upgrading Projects

There are two main government agencies that oversee infrastructural upgrading projects in Singapore. These are the URA (Urban Redevelopment Authority and the LTA (Land Transport Authority). Because of the limited land parcels available for development, these two government statutary boards constantly study ways and means to optimize land use and transport networks.

The URA focuses primarily on vertical expansion of commercial and industrial properties earmarked for redevelopment. Demolished buildings in the business and shopping districts are replaced with higher buildings and building complexes. Most of these redeveloped properties are owned by the major real estate players such as Capital Land, Keppel Land, Far East Organization, City Developments and the Hong Leong Group.

The LTA is responsible for managing land transport routes. This includes underground and overhead MRT lines encompassing the island. Presently, additions to the MRT are underway and are projected to be completed by the year 2010. As it stands, one could travel from Singapore’s Changi International Airport to all the major business, shopping and exposition locations on the island without these added additions.

The new Central Central Business District that is now under construction at the tip of Marina Bay shall have the most comprehensive and advanced fully integrated underground complexes the world has ever seen. Dubbed the city with the city, this district shall have all the amenities including shopping, leisure and entertainment outlets. It is on this site that the Integrated Casino Resort is also being built.

A Regional Operations Hub

Singapore’s central position as a regional air and sea route ideally positions it as the location of choice in setting up a Regional Operations Hub. Reliable air and sea ports, efficient communications infrastructure and capability, and sound governance further support this. Voted as being one of the safest and least corrupt countries in the world, Singapore also has world class conference and exposition facilities, efficient land transport routes and excellent public transport services.

The government’s efforts at promoting Singapore as the regional center of all business activities is given very high priority, second only to tourism. And it is for this very reason that private landed property and many exclusive apartment condominiums can be purchased by the many foreigners who have set up their offices and operations here.