Market supported by jet-setting high net-worth individuals: report
LUXURY homes in Singapore are the second most expensive in Asia and the ninth most expensive in the world.
According to a report by Citi and Knight Frank, luxury home prices here are now US$2,423 per sq ft.
The only place in Asia where they are more expensive is Hong Kong, where they cost US$4,507 psf. Even Tokyo is cheaper than Singapore, coming in third most expensive at US$2,334.
Worldwide, London is the most expensive, followed by Monaco and St Jean Cap Ferrat (France) at US$6,191, US$5,888 and US$5,853 psf respectively.
The global luxury home market is supported by jet-setting high net-worth individuals who think nothing of owning homes on every continent.
As an example, the report describes a Brazilian/Russian family that owns apartments in New York, Geneva, Ibiza and, until recently, Singapore.
The family reportedly spends equal periods at each property, with business and social ties meaning they find it possible to change location for long or short periods with ease.
‘In many ways, none of their properties is regarded as either a primary or secondary residence,’ the report says. ‘In fact, they feel equally at home in all of them.’
The report ranks high net-worth individuals in four categories - those with US$1 million to US$10 million; US$10 million to US$100 million; US$100 million to US$1 billion; and more than US$1 billion.
It found that 15.7 per cent of entry-level high net-worth individuals own four or more homes. In the second, third and fourth (the richest) categories, the respective percentages increased to 23.3, 31.5 and 60 per cent.
Importantly, the report found that in both developed and emerging economies, uncertain economic and political conditions did not affect the growth in numbers of high net-worth individuals, with the growth of their wealth, ’similarly undimmed throughout 2007′.
Citing data from Scorpio Partnership, the report says the most significant growth in 2007 was in the US, where the number grew almost 120,000 to 3.1 million. China had the second-largest increase, with the figure rising almost 46,000 to 373,000 - almost as many as Germany.
‘Despite the credit crunch, extraordinary wealth creation has continued across the global oil and commodity sectors,’ the report says.
An example of the strength of the global luxury home market is that in London the number of £10 million-plus sales in Chelsea, Knightsbridge and Belgravia rose 190 per cent in the six months to January 2008 from the same period a year earlier.
In the US, where prices fell 4.5 per cent over the past year and 4.2 per cent in New York generally, prices for prime Manhattan properties rose 25 per cent.
Knight Frank’s head of residential research Liam Bailey said: ‘Prime locations have held their own. London, New York, Shanghai and others are proving that almost any residential market tied to the global economy maintains confidence among purchasers.’
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