Singapore remains the 2nd most expensive housing market in the world after Hong Kong

Average price growth is modest compared to other gateway cities according to CBRE’s fifth annual Global Living Report

Singapore, April 11, 2019 – Singapore ranks second among the most expensive residential property markets worldwide, while Hong Kong maintains its top position, according to research released today by CBRE. Nonetheless, property prices in Singapore are relatively more affordable, costing about half that of prices in Hong Kong on a per square foot basis. Average price growth in Singapore was also at a low 1.1% outpaced by Hong Kong and Shanghai which recorded 5.5% and 11.2% growth, respectively.

In the fifth annual Global Living report, CBRE has compared the property markets across 35 key global cities. The results reinforced that investments in urban areas such as transport infrastructure, connectivity, retail, cultural centres and housing are key drivers of economic growth.

Jennet Siebrits, Head of Residential Research at CBRE UK, comments, “In the fifth edition of the Global Living report, we have expanded the number of cities we examine from 29 to 35. They include the most exciting cities in the world, from emerging technology-driven powerhouses like Shenzhen and Bangkok through more traditional capital cities such as Rome and Lisbon, to rapidly evolving modern urban centres like Dubai and Johannesburg. The world’s greatest cities continue to transform to encourage innovation, increase their working and living populations and create new commercial opportunities for businesses.”

The top three most expensive places to buy a property are once again in Asia, all of which have maintained the same positions as last year. Hong Kong remains the most expensive city with the highest-value residential real estate, with an average residential property costing US$1.235 million (US$2,091 per sq ft). Singapore maintains its second place, averaging US$874,372 (US$1,063 per sq ft), and Shanghai is third at US$872,555 (US$714 per sq ft). These three cities have introduced cooling measures to keep prices under control.

Global Living: Top 10 highest value locations

Rank	City	Average property    price ($US)	Average price per square foot ($US)
1	Hong Kong	1,235,220	2,091
2	Singapore	874,372	1,063
3	Shanghai	872,555	714
4	Vancouver	815,322	n/a
5	Shenzhen	680,283	726
6	Los Angeles	679,220	466
7	New York	674,500	526

8	London	646,973	776
9	Beijing	629,276	575
10	Paris	625,299	985

Source: CBRE

Desmond Sim, Head of Research, Southeast Asia, weighs in, “As a financial hub, Singapore is known for its skilled talent, ease of doing business, top-notch infrastructure, as well as economic and political stability. Singapore has always been an attractive location for multinational companies to establish their regional headquarters. These factors influence the cost of property ownership in the city. Having said that, property prices in Singapore are still relatively affordable compared to those in top-ranked Hong Kong and our average price growth over 2018 is one of the lowest compared to the other 34 cities in this study.”

Average house prices are growing in 30 out of 35 cities. The biggest year-on-year growth was experienced in double-digits by Barcelona (16.9%), Dublin (11.6%), Shanghai (11.2%) and Madrid (10.2%).

Ms Siebrits adds, “House prices increased year-on-year across 30 out of the 35 cities we looked at, although generally at lower rates than last year. In general, we are seeing house price growth slow across cities as we move towards the end of a long property cycle. We would expect increasing interest rates to be affecting cities in the US and various cooling measures affecting the Asia Pacific region, although Shanghai still saw robust growth.

“Six out of the ten cities with the highest house price growth are in Europe. Three of these – Barcelona, Madrid and Dublin – all suffered severe price falls in prices during the financial crisis and took much longer to recover from the economic downturn that followed. Now that they are recovering, they are showing significant growth. In comparison, London recovered much faster after the downturn and is now further into the cycle.”

Global Living: Top 10 cities for house price growth

Rank	City	Average house price growth
1	Barcelona	16.9%
2	Dublin	11.6%
3	Shanghai	11.2%
4	Madrid	10.2%
5	Paris	9.1%
6	Moscow	8.9%
7	Cape Town	8.7%

8	Milan	7.0%
9	Los Angeles	6.4%
10	Istanbul	6.1%
...	...	...
12	Hong Kong	5.5%
...	...	...
27	Singapore	1.1%

Source: CBRE

Mr Sim adds, “To prevent cost of living from becoming too prohibitive for its citizens, the Singapore government has since introduced a series of property curbs to cool the housing market. As a result, price growth has declined for the second straight quarter in Q1 2019 after five consecutive quarters of strong growth since Q3 2017. Coupled with increasing supply and weaker sentiments, prices are likely to moderate or remain flat from this year going forward.”
 
The research also highlighted considerable rental growth in many European cities, including Lisbon, Madrid, Dublin and Barcelona. Supply constraints and increasing demand were among the factors leading to Lisbon and Madrid’s continuing double digit rental growth.

Ms Siebrits comments, “Six European cities feature in the top ten for rental growth, including London. All these cities are facing increasing demand and a fundamental lack of supply. In addition, the three Canadian cities – Vancouver, Toronto and Montreal – are driven by strong employment growth and low vacancy rates.”

Global Living: Top 10 cities with the highest monthly rent

Rank	City	Average monthly rent (US$)
1	New York	2,844
2	Abu Dhabi	2,807
3	Hong Kong	2,777
4	Jeddah	2,399
5	London	2,389
6	Los Angeles	2,312
7	Dublin	2,226

8	Riyadh	2,199
9	Dubai	2,044
10	Singapore	1,935

Source: CBRE

Read the full report here: www.cbreresidential.com/uk/en-GB/content/global-living-2019

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