Overseas property becoming cheaper as Sing dollar rallies

Properties in Malaysia, Australia and the UK are becoming more attractive to Singaporean investors due to the rising exchange rate of the Singapore dollar against the currencies of these countries, media reports said.

For instance, RM1.00 is now equivalent to S$0.374 from S$0.379 in December 2014, while A$1.00 is now equivalent to S$1.064 compared to S$1.082 at the end of last year.

Similarly, the British pound sterling’s value fell to S$2.057 from S$2.065 back then.

Consequently, properties in these countries have become more affordable to Singaporean investors, while property developers and consultancies have noticed greater Singapore interest in these markets.

“The strengthening of the Sing dollar may have helped tip fence-sitting buyers into making their first move into Iskandar,” said Vincent Tan, head of Mah Sing’s Singapore office.

“Of late, we have received more inquiries from our Singapore clients in our properties, not just in Iskandar, but also in Kuala Lumpur and Penang.”

Likewise Colliers International’s Sales Director of international properties (South-east Asia) has observed that Singaporean investors are mostly interested in UK properties, especially in London.

Looking ahead, experts revealed that the currencies of the three aforementioned markets are expected to weaken further due to various factors.

For instance, the Malaysian ringgit could be dragged down by the 1MDB debt issue and weaker growth prospects in the country, while the Aussie dollar could be weighted down by China’s economic difficulties and the lacklustre market for metals and many commodities, UOB said.

Moreover, both currencies could be dragged down by the rallying US dollar, it noted.

For the British pound, it could be squeezed by uncertainty over the upcoming UK general election in May, added Sim Moh Siong, Senior Currency Strategist at Bank of Singapore.


Romesh Navaratnarajah, Singapore Editor at PropertyGuru, edited this story. To contact him about this or other stories email romesh@propertyguru.com.sg