Singapore becoming 'less attractive' for expats
Singapore’s reputation as a destination of choice for expats in Asia has been hit by a triple whammy this month
11:48AM GMT 12 Dec 2011
Two measures by the government last week have made the city less attractive to non-Singaporeans – the biggest being a 10 per cent hike in stamp duty for any foreigner wanting to buy property in the city.
Stamp duty was only three per cent at its highest rate, so this move is seen as a strong curb to discourage foreigners from buying homes in Singapore.
Foreign purchases made up 19 per cent of all private property transactions in the second half of 2011. This compares to just seven per cent for the first half of 2009. Low interest rates, political stability and a strong economy have all led to a surge in property investment from wealthy foreigners.
Ku Swee Yong, chief executive at Singapore-based estate agency International Property Advisor, worries that “we leave foreign investors with a bad taste in their mouths.” He said: “Many foreigners are here to work and settle their families down and they need to own one home for shelter over their heads."
Last week the government also scrapped a scheme that lets graduates of foreign universities stay in Singapore for one year while they look for work.
The Manpower Ministry previously granted an employment pass eligibility certificate (Epec) to foreign university graduates in the hope to encourage high-calibre students to enter the labour force. But it said the scheme was not meeting its targets.
In the third setback for the city state, Singapore has also overtaken Hong Kong as the more expensive city for expats to live in – the first time this has happened in more than 10 years, according to the latest cost of living survey conducted by ECA International.
Within Asia, Singapore is now the sixth most expensive city to live in while Hong Kong has dropped to ninth. Tokyo is still the costliest location for expats.
George Hackford, a British expat who has lived in Singapore for more than five years, said: “From my point of view, I have seen 'real' inflation rise steeply in the past two or three years. This is mostly in the areas of luxury goods, which are often bought by expatriates.
"Rents have obviously increased substantially but so too have items such as alcohol, groceries and taxi fares. In general, prices of imported electrical goods such as computers and cameras have also inflated strongly. It seems to me that published inflation rates seem to be out of kilter with real prices.”
