If you are working in Singapore, it is of course best to buy property in Singapore. Not to mention, compared to the 5% – 6% mortgage rates commonly seen in China, Singapore’s 1% to 1.8% rates are incredibly attractive. Furthermore, you can apply for Permanent Resident (PR) status in the future, which grants a 15% reduction in stamp duty for property purchases, making it even more cost-effective.
There are two main aspects to consider when buying a property:
- Ultimately, a house is for living in. Whether for your own stay or for rent, the quality of the property itself is very important. Even for a pure investment property, a high-quality unit will have greater potential for appreciation and will be easier to resell. If you are working in Singapore, you could buy a property to live in for a few years. If you decide to return to your home country, you can sell it or rent it out. Singapore’s rental yield definitely outperforms Shanghai’s, and using rental income to cover mortgage payments is entirely feasible. This way, you save on rent while also making a good investment. Moreover, for the same price, you can buy a large two-bedroom apartment next to an MRT station in Singapore (Singapore has no common shared area, or “gongtan”), or even a three-bedroom unit in an area slightly further out. The environment and amenities are certainly better—after all, it’s an internationally renowned Garden City and financial hub. You also don’t have to worry about renovations (which are time-consuming, laborious, and expensive), as you can basically move in right away, saving a lot of hassle. For the same price in Shanghai, you could only afford an old, small, and run-down apartment, or a new but very remote one. Either the location is too far and inconvenient for living, or it completely lacks amenities (A swimming pool? Don’t even think about it). Furthermore, whether it’s an old, run-down unit or a new but remote one, it would need to be renovated, which is both troublesome and costly.
- From an investment perspective, for these two cities, value preservation is not an issue (at least for now). In terms of appreciation, Shanghai properties might have more room to grow, but correspondingly, the risks are also higher (just look at the recent turbulence in China’s property market) and are susceptible to policy changes. In comparison, Singapore’s property market is very stable with lower risk. If you work in Singapore, you should have some understanding of its various housing policies. The government strictly cracks down on property speculation, which ensures price stability from a policy standpoint. Overall, Singapore’s property prices see steady growth. After all, it’s an international financial center with a small land area, a continuously developing economy, and a growing population of foreign professionals. With demand exceeding supply, price appreciation is inevitable, regardless of government controls. Therefore, if you want to achieve good returns with lower risk, I personally highly recommend purchasing property in Singapore. If you are considering a second property, then you could consider Shanghai.
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