Complete Property Market Updates of Singapore

June 4, 2008

Home away from home overseas

Filed under: General,Genius Thoughts,Property Investment — Propertymarketupdates @ 4:59 am

Every fortnight, Mr Shahul Hameed, 50, packs his wife and three daughters into the car and drives across the Causeway.

The family’s retreat is a 2,400 sq ft, two-storey semi-detached house in Gelang Patah, Johor. It is part of a gated community called Leisure Farm Resort Residences, located 30 minutes from Singapore.

Their home away from home is where they can indulge in fishing, cycling and take the occasional boat trip to the nearby island of Tioman.

Mr Shahul, a financial planner with NTUC Income, bought the Balinese-style property, which features dark wood finishes and floor-to-ceiling glass windows, about four years ago for RM537,000.

In Singapore, he owns a 1,600 sq ft condominium apartment in Sims Avenue, which cost him $732,000.

He says: ‘When you have money just sitting in your bank, you tend to spend it. So I thought why not buy a second home nearby?’

The family has benefited from the regular weekend getaways, he claims. Since buying the house, he has consistently exceeded sales targets at work. His three daughters, whose ages range between five and 19, have performed better in their studies.

He adds: ‘I believe a change of environment now and then helps you lead your life in Singapore better.’

Owning a holiday home overseas may no longer be a luxury afforded only by Singapore’s super-rich, as more regular folk like Mr Shahul invest in overseas properties too.

Others discovered by LifeStyle include a teacher, an owner of a small business and a marketing consultant, though not all agreed to be interviewed.

Retired teacher Natahar Bava, 62, and his family own a semi-detached house at Sunset Way. But they spend holidays at their second home at the Kennedy Bay Resort in Perth, where their beach-facing, two-storey villa boasts an unobstructed view of the Indian Ocean.

Mr Bava, who has three daughters aged between 20 and 37, bought the house in 1997 for A$400,000 for his second daughter when she enrolled at a university there.

But the girl chose to live in the university hostel instead, so the property became the family’s holiday accommodation.

They visit as often as three times a year to rejuvenate, often paddling out to sea in a pair of kayaks they own.

‘It was a good turn of events that fulfilled an original dream I had,’ says Mr Bava. In 1982, he had taken a group of students to Perth on a school field trip. Smitten by the tranquillity of the place, he swore to one day own a home there.

‘WA (which stands for Western Australia, the territory Perth is located in) also means ‘wait a while’,’ he says in reference to the slower pace of life there.

Being an ‘average Singapore citizen’, he was only able to afford a place 15 years later, he adds.

There are no exact figures to the trend, but in general, developers and property companies who market overseas projects here point to a growing interest among Singaporeans to put their money in homes offshore.

At Colliers International, which has launched recent projects in places like Australia, Malaysia, New Zealand and Thailand, business in the overseas sector grew four to five times from 2004 to 2007, says its associate director of international projects Michael Tan.

Executive director of DTZ South-east Asia, Mr Heng Hua Thong, adds that the number of overseas property launches in Singapore has also increased.

‘At least every month you have one project launched in Singapore. That’s definitely more compared to one or two years ago,’ he says.

With the local property market only just settling after a spate of sky-high property prices, it makes sense for some to look elsewhere where risks are not so great, says managing director of Orange Tee Global Properties Dave Loo.

The agency markets developments in places like Malaysia, Thailand, Australia and the United Arab Emirates.

Thailand’s market, for instance, has undergone several tax revisions recently to entice foreign investors. An apartment in a place like Phuket can go for as low as $100,000, adds Mr Loo.

While it is still more common for Singaporeans to buy for investment, he estimates that between 30 and 35 per cent of his customers buy properties to use as holiday homes or for their children who are studying overseas.

For the former purpose, resort destinations like Phuket or Bali are naturally more popular than city locales, he adds.

Prominent National University of Singapore lecturer K. K. Seet, for instance, bought a 2,000 sq ft, Thai-Balinese house in Pattaya for $300,000 in September 2006.

Says the 40-something bachelor: ‘I’ve always wanted a house near the sea, which would be impossible to achieve in Singapore, unless one is prepared to fork out millions for Sentosa Cove.’

He bought the house somewhat unexpectedly while on holiday in Pattaya, and now visits about three to four times a year.

Dr Seet says he was attracted to the city’s contrasting flavours, such as the sight of a high school band performing on a pedestrian boulevard, ‘while go-go girls were twirling around poles in a nearby bar even as busloads of tourists were tucking into a seafood buffet in an adjoining restaurant’.

‘It’s this heady mixture where everything is ‘live and let live’ that is fascinating,’ he adds.

Industry players like Mr Peter Thng, executive director of Reapfield Property Consultants, agree that the demographics of overseas home buyers have diversified to include middle-income earners. The agency has sold properties in Australia, New Zealand, Britain and Malaysia.

He says: ‘This is not surprising given the affluence of the society and also the fact that many have either lived, studied or worked overseas.’

In the 1990s, middle-aged businessmen formed his main group of customers. Today, apart from professionals, ‘civil servants such as teachers and military personnel form the bulk of our client base’, he says.

For Singaporeans scouting for holiday homes, proximity is perhaps the biggest selling point. Properties in the region, such as Malaysia, Thailand and Australia are favoured, though countries like Malaysia – which offer advantageous exchange rates – have extra appeal.

In a recent survey carried out by Malaysia’s Real Estate and Housing Developers Association, Singapore was identified as its top foreign market. Malaysia has a My Second Home programme, which allows foreigners with a certain amount of capital to buy houses there.

At Johor’s Leisure Farm development, 49 per cent of buyers are Singaporeans or expats based here, says its sales manager Peter Lim. ‘Their profiles include professionals, businessmen, people looking for a shortcut to their dream home.’

Indeed, with holiday homes becoming a prized asset, few owners are willing to rent out their place to vacationers to cover costs. Says Dr Seet: ‘I’m not interested. What if they wreck the place?’

Still, those interviewed by LifeStyle say the returns on their investments have been far from poor. Mr Bava, for instance, reckons his Perth abode is now worth more than twice the A$400,000 he paid.

Mr Shahul is even planning to buy a third home at Leisure Farm, a bungalow 21/2 times the size of his current semi-detached house.

If he cannot find a suitable buyer for his existing Johor property, he will still keep it, ‘as a present for my children’, he says with a smile.

‘When you have money just sitting in your bank, you tend to spend it. So I thought why not buy a second home nearby? I believe a change of environment now and then will help you lead your life in Singapore better.’ – SHAHUL HAMEED, a financial planner, who bought his house in Gelang Patah, Johor, which he visits every fortnight with his family, daughter Nur Istiqamah, eight, wife Nur Asyiqin Abdullah, 35, and daughters Nur Diyanah, five, and Zaakira Mahreen, 19

‘It was a good turn of events that fulfilled an original dream I had.’ – NATAHAR BAVA, who bought a house in Kennedy Bay Resort in Perth, in 1997

‘I’ve always wanted a house near the sea, which would be impossible to achieve in Singapore, unless one is prepared to fork out millions for Sentosa Cove.’ – DR K. K. SEET, NUS lecturer, who has a 2,000 sq ft Thai-Balinese house in Pattaya

Source : Sunday Times – 11 May 2008

Advertisements

Leave a Comment »

No comments yet.

RSS feed for comments on this post. TrackBack URI

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Blog at WordPress.com.

%d bloggers like this: