http://www.businesstimes.com.sg/sub/...27140,00.html?

Published October 21, 2011

YESTERDAY IN PARLIAMENT

Govt monitoring foreign buying of private homes

Over four-fifths of private home purchases this year by S'poreans, PRs


NATIONAL Development Minister Khaw Boon Wan said yesterday in Parliament that the government is monitoring foreign buying of private homes and will take further measures if necessary.

He noted that locals (Singaporeans and permanent residents) account for more than four-fifths of private home purchases this year.

'Foreign demand has nevertheless been growing. Last year, foreigners accounted for 12 per cent of private housing purchases. This has grown to 16 per cent in the first half of this year,' Mr Khaw said.

'We are monitoring market conditions closely and, if need be, we will take further measures. For landed property, we have long- standing rules restricting foreign purchases which we recently tightened. However, we have to be very careful not to precipitate a loss of confidence, especially with the international backdrop of continuing uncertainty in financial markets and weak growth in the US and Europe,' he added.

Mr Khaw was responding to questions from MP Christopher de Souza on whether the minister will consider implementing measures to restrict the number of private properties a foreigner can buy and whether the amount of foreign ownership in private property is a cause of the high prices in the property market.

Among various things, Mr de Souza also asked whether measures will be put in place to curb speculation by foreign buyers of private property to make prices more affordable for genuine Singaporean homebuyers.

Mr Khaw said: 'Singaporeans are understandably anxious when they see property prices rising, especially those who are first- time buyers of private property. The rising property prices cannot be attributed solely to foreign purchases. There are many factors at play, such as low interest rates and our strong economic fundamentals.'

When asked by Mr de Souza if MND would consider the Australian system where foreigners are limited to buying properties in new developments and can sell only to Australians, Mr Khaw noted that countries have different approaches to property ownership.

'Policies are never static . . . we keep a close watch over the situation. It is not just watching over the property market. Because . . . while I need to make adjustments to housing policies, even more important is to make sure our adjustments do not unwittingly damage, do harm to our economy and our society. Because at the end of the day, they are all interlinked,' said Mr Khaw. It's an act of balancing and making trade-offs, he added.

GPC chairwoman (National Development and Environment) Lee Bee Wah asked what level of foreign ownership would warrant taking further action.

Mr Khaw noted that any measures are market sensitive. 'So that makes it difficult for me to be too expressive in my reply. I think I should just stop here.'