The government has repeatedly emphasized that it’s too early to review the property curbs.
Some prospective property buyers are unhappy over the lack of any measures in the recently announced budget to help Singapore’s sluggish housing market, reported The Straits Times.
Singaporean businesswoman Leena Ganesan, 41, and her husband who is a permanent resident, were upset that the authorities did not repeal or ease the Additional Buyer’s Stamp Duty (ABSD), as they were considering the purchase of a two-bedroom condo.
“We have put our investment plan on hold now for two years. If we don’t see anything moving in the next one year, we may invest in India instead,” said Ms Ganesan, who lives in a landed cluster home in Bukit Timah, which she purchased for $3.05 million four years ago.
According to experts, if the government had relaxed some of the curbs, people like Ms Ganesan would have been encouraged to invest. This could have boosted transaction levels slightly, which would have some positive spillover effect on other sectors.
“It will have some spin-offs in other areas: contractors, banks, property agents, furniture retailers. If foreigners come to view properties here, then the tourism sector may also benefit,” said Mohamed Ismail, CEO of PropNex.
In addition, a rise in transaction levels would spur developers to divert capital back to Singapore, shared EL Development’s Managing Director Lim Yew Soon.
“The market is slow, so you see investors and developers investing overseas. There is an outflow of funds from Singapore.”
Developers have repeatedly urged the government to ease its property cooling measures, as these have led to a sharp decline in home sales. Annual transaction levels have plunged to about 7,000 units in the past two years compared to 14,948 units in 2013.
Home builders are also struggling to find buyers for many units, which puts pressure on rental prices and negatively affects the earnings of these companies, noted Tan Zhiyong, Managing Director of MCC Land.
In Q4 2015, there were 5,736 private housing units launched but not sold, according to data from the Urban Redevelopment Authority (URA). Overall, there were 23,271 uncompleted units still unsold last year.
During the same quarter, the vacancy rate for such homes also reached 8.1 percent, the highest in 10 years. Furthermore, prices dropped by 3.7 percent in 2015, following a fall of four percent in 2014.