Singapore wealth report 2021
Julius Baer Wealth and Lifestyle Report
The Singapore Wealth Report extracted from 2021 Julius Baer Lifestyle Index is based on a basket of 12 consumer goods and eight luxury services that represent discretionary purchases by HNWIs globally in 2020. The Index is not intended to represent the comprehensive spending patterns of HNWIs, but rather to provide an indication of how selected goods and services are priced around the world. This is used as the basis for further analysis of developments in HNWI consumption patterns and lifestyle considerations.
The Index is based on the prices at the time of data collection from brand-owned boutiques or authorised vendors for items in 25 major cities.
The data was gathered between July and September 2020. Prices included all taxes and ancillary fees and were converted from the local currency to USD on a fixed date. Weighting was applied proportionally to some items in the Index. Residential property was weighted at 20 per cent and cars at 10 per cent. This reflects the relatively high price for these items and the fact that a purchase repre- sents an important milestone. The remaining 70 per cent was distributed evenly across the rest of the items.
Data for residential property was based on the average price per square metre for three top-end properties in each city in the first half of 2020, and was provided by Knight Frank.
Singapore Wealth Report
The Lion City is still one of the world’s more expensive cities. Singapore takes the ninth spot in this year’s Index, with prices of premium goods remaining high. This is the most expensive city in the Global Wealth Index to own and run a car. The government has levied high taxes on vehicles to discourage use because of limited road space.
Those seeking fine dining, men’s suits, ladies’ handbags, and lawyers’ services might pay more here, compared to neighbouring cities. However, ladies’ designer shoes have become an affordable purchase in Singapore in 2020; prices have dropped by a fifth since 2019 in dollar terms. Fashion in this city is worth just under a third of the whole luxury market, and it is projected to grow by an estimated 8 per cent a year on a compound basis between 2020 and 2025.
The property market in Singapore has been healthy, buoyed by local demand and a steady stream of investors from other countries. Despite entering a full-year recession in 2020, sales of private homes remained strong, according to the Urban Redevelopment Authority. Singapore’s economy has weathered the impact of the Covid-19 crisis better than many. The Singapore Government and the Monetary Authority of Singapore took decisive action in response to the pandemic, offering a package of measures to support individuals and organisations. The Singapore Government has underwritten 90 per cent of loans to struggling small businesses, for example.
The city-state’s economy ended up contracting by 5.4 percent in 2020, but it is expected to bounce back strongly 9 this year: early estimates point to 5.5 per cent growth for 2021.
Singaporeans take a traditional view of wealth management and so have an affinity for real assets. Property ownership remains high at 91 per cent, with many hoping to buy a second home when they can afford it. This is even true for the younger generation and most feel that paying rent is money down the drain in the long term.
However, with the advent of near zero commission stock trading and access to global online trading platforms, the younger generation has also taken to equity investments.
For older Singaporeans, a lack of expenditure on holidays has translated into bigger buys back home. In 2020, luxury cars took up almost 49 per cent of all car sales in Singapore. Families have taken to ‘staycations’ in and around the city as an alternative to foreign travel, and hotel room rates locally have tripled over the past three months.