It seems as though everyone wants a piece of Singapore right now. The city state is undergoing a facelift, causing more people than ever to invest in its booming property market. With ambitious plans to transform its downtown area into a prime vacation spot and international financial centre, Singapore is bound to attract much global attention in the next few years.

New Developments

Scheduled to be completed in 2012, White Sands and Genting are developing luxurious resorts equipped with world class casinos and high-end retail in Marina Bay and Sentosa. These developments will almost certainly increase Singapore bays’ appeal. More importantly, property around the area will likely increase in value as the resorts draw in a large group of professional expatriates and glitterati. Demand and prices are expected to continue rising and we are confident the value will only peak when the resorts are launched.

Good location, modern design

Singaporean developers fuse trustworthy engineering with modern architecture, creating a series of eclectic living spaces in town. In fact, you could easily mistake them for a designer building in the heart of Tokyo or Hong Kong. Herein lays the catch. These boutique units are gradually becoming the norm in downtown residences in Singapore and cost only half the price of those in the city’s competitors. It is no surprise foreign talents are moving to the island nation.

Could it be a bubble?

When 2007 came to an end, the state newspaper, Straits Times reported on the record property prices reached in the past year. While it is true that several condominiums fetched eye-popping prices, these were exceptions to the general picture. Overall, the prices of downtown property are forecast to rise at a more sustainable pace of 10 to 20% this year. What investors can expect is steady returns over the long run.

Lower real interest rates

Home loan rates in Singapore typically range from 3 to 4%. Yet due to the record-high inflation of 3.6% in October 2007, pressure will be put on the already low interest rates. Real mortgage rates at the moment are only slightly above zero, at about 0.5 to 1.0%. What this means is a positive effect on borrowers. Instead of keeping money in the bank and losing out from the low bank rates, investing in property is a far more attractive proposition.

There is so much talk about Asia, yet many Asian countries suffer from a corrupt and shaky market. Singapore stands out in the eyes of property investors because the market is matured and stable. Singapore promises exciting developments tempered with careful governance and there is perhaps no better time to invest in the garden city.

Keith Lau is a professional real estate agent based in Singapore, and may be contacted at: Singapore Prime Districts