Luxury property prices stabilise in singapore and china

Luxury property prices have started to stabilise in Singapore and China after six months of declining, according to Jones LangLaSalle.

JLL's latest residential index also shows that prices of residential property in Hong Kong rose a further 1.7 percent during Q3, with year-to-date price growth totalling 5.7 percent.

Across the nine luxury residential markets in Asia monitored by the firm, average capital values rose by 1.9 percent quarter on quarter (q-o-q) in Q3, compared with the 0.8 percent q-o-q increase recorded in Q2.  Indeed, five out of the nine saw an increase in capital values during the quarter, while the remainder recorded minimal or no Change.

Values of luxury property in Singapore stabilised after correcting for two consecutive quarters, largely supported by end-user demand. Average prices also began to stabilise in China, helped by fewer price discounts from developers. Primary capital values for the high-end market in Beijing rose by an average of 7.4 percent, although due mainly to larger units being launched, while capital values for luxury apartments in Shanghai were largely unchanged q-o-q.

While Jakarta continues to outperform all monitored South East Asian markets with q-o-q price increases of 6.3 percent, average prices were flat in Manila and Kuala Lumpur and rose modestly in Bangkok. A significant amount of new supply over the next one to two years is limiting upside potential in these markets.

Joseph Tsang, Managing Director and Head of Capital Markets, Jones Lang Lasalle Hong Kong said: "The residential market in Hong Kong has been particularly strong this year, thanks to low interest rates and stronger buyer sentiment. Hong Kong's capital values are expected to see a mild correction over the short term after the government introduced buyers' stamp duty on foreign and corporate buyers in late October. However, any further downside risk should be limited by tight supply and low holding costs."

Looking ahead, Dr Jane Murray, Head of Research, Asia Pacific, Jones Lang Lasalle said: "Policy restrictions in various markets - such as special and buyer's stamp duty in Hong Kong and Home Purchase Restrictions in China - should remain in place at least until 2014, thus potentially limiting sales activity and further price increases, despite low interest rates. Capital values of Singapore's high-end properties are expected to edge up modestly in the next twelve months, mainly supported by domestic buyers. Among the emerging SEA markets, Jakarta will likely to see the strongest price growth for the next 12 months due to solid local demand."