Singapore’s luxury home market is thriving thanks to factors in other countries, such as stamp duties in the UK.

The tax amnesty in Indonesia may not be the only thing driving sales in Singapore’s luxury home market, reported Singapore Business Review, citing Jefferies.

According to the American global investment bank, the growth in transactions in the high-end residential sector can also be attributed to the morphing of businesses into investment hold companies or family offices.

“Companies which are not involved in real estate are closing down or merging because of various reasons, including lack of growth, cost pressures, thin margins due to competition, succession planning issues and / or outright bankruptcy,” it said.

“Such business owners are partly investing the cash proceeds into investment property to seek rental income.”

The uptick in luxury home transactions can also be attributed to the introduction of stamp duties in the UK and Australia, as well as the concerns surrounding Brexit.

“As of (the) quarter ending March, Singapore had the weakest luxury market for seven consecutive quarters, according to Knight Frank. Combined with this, tax regimes have changed in other cities. For example, stamp duties have been introduced in London for second homes and application fees have been introduced for foreign property buyers in Australia,” noted Jefferies.

“Thus the ABSD regime in Singapore is finding parallels in other places too, and Singapore is attracting some of the investment dollars.”

Original article here.