| MARKET NEWS, JANUARY
2005
The market values of memberships at Singapore’s
golf clubs were fairly stable during 2004 and early signs
for 2005 are for a continuation during the next few months.
The cost of a local membership in the most expensive club,
Singapore Island Country Club (SICC) is presently around
S$128,000. What does this mean to those thinking of taking
the plunge and acquiring one of these prized possessions?
News about the Clubs
Sentosa has announced an upgrading and renovation of
its Tanjong course starting this year; but they will be
planning to schedule the work so as to minimise disruption
of play.
Particularly good value for money, appear to be Raffles
Country Club which has two first class 18 hole courses,
available for around $38,000, and Keppel Club, which has
completed a much admired upgrading of their course and
is available for around $28,000.
Singapore Island Country Club is still the star attraction
with four 18 hole courses and a very pretty new 9 hole
course, the “Millenium” for beginners and
casual practice; together with full country club facilities.
SOME FREQUENTLY ASKED QUESTIONS:
1. Why are golf club membership prices in Singapore so
high compared with other countries? The answer is: scarcity
of land in this prosperous but densely populated island.
We are paying for access to precious hectares, even when
they are unsuitable for most other uses, such as the water
catchment areas on which the Singapore Island Country
Club (SICC) courses are built; or the reclaimed areas
near Changi Airport where the Tanah Merah and Laguna clubs
are situated.
2. Should one buy a golf club membership as an investment,
hoping to profit when the economic cycle turns upward?
If you are sufficiently hooked on the game to be willing
to pay Singapore prices to play, the present time is likely
to turn out to have been a good time to buy. But the high
transaction cost in the form of transfer fees in the range
of 20% to 50% or more of the market value, makes these
memberships quite unsuitable for speculative investment.
3. Why are transfer fees so high? As the market prices
of golf club memberships rose in the mid-1990s, clubs
increased their transfer fees to keep them around 20%
of their membership’s values. As prices have declined
during the past several years, transfer fees at some clubs
have not been reduced in proportion. So we now have a
range from about 17% of market value for Sentosa Golf
Club to about 50% for Raffles Country Club and Seletar
Country Club. These are for local buyers (Citizens and
Permanent Residents of Singapore); sales to foreigners
are subject to higher transfer fees - up to double the
rates for locals at Tanah Merah, Raffles, Jurong and Seletar.
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