Tag Archives: Cooling measures

Govt may still relax property curbs this year

Consultants believe the government will tweak the measures if condo prices drop significantly.

Experts still believe the government may ease its property cooling measures later this year or in early 2017, despite the lack of goodies announced for the property sector in Budget 2016, and the higher foreign worker levies in the construction sector, reported Singapore Business Review.

“We expect the government to continue monitoring the residential market, and relaxation is likely only nearer end-2016,” said RHB Research in a report.

The consultancy thinks authorities will likely tweak the property curbs if home prices drop by 12 to 15 percent from its peak.

The government may also review the measures if developers can no longer bear the extension fees that they must pay for failing to dispose residential units within a stipulated period under the Qualifying Certificate (QC) and Additional Buyer’s Stamp Duty (ABSD) rules.

Meanwhile, Maybank Kim Eng reckons the reason why the cooling measures are still in place is because home prices remain too high. It also shows that authorities are satisfied with the low number of non-performing housing loans and high leverage mortgages.

“Further downside should be expected before any lifting is made. This is in line with our view that there is not enough pain in the market yet and cooling measures may only be reviewed in early-2017.”

But if Singapore’s economy takes a turn for the worse and drags down home prices, the government may prioritize lifting the curbs, added Maybank Kim Eng.

Still too early to remove cooling measures

It is premature to lift the property cooling measures as it could undo the government’s efforts to make home prices affordable, revealed National Development Minister Lawrence Wong during a parliamentary session on Monday (29 Feb), and reported Channel NewsAsia.

He was responding to a query from Holland Bukit-Timah GRC MP Christopher de Souza, who asked if the authorities would consider scrapping the Additional Buyer’s Stamp Duty (ABSD) for Singaporeans, but keep it for foreigners.

Mr de Souza first proposed the idea in Parliament in January this year.

“The ABSD was introduced to moderate the demand for residential property from investors, non-citizens and corporate entities,” said Mr Wong in a written reply.

“Singapore citizens who do not own any residential property do not need to pay (any) ABSD,” he added.

Currently, Singaporean citizens need to pay a stamp duty of seven percent when they buy a second home. This rises to 10 percent for their third and subsequent purchases.

On the other hand, foreigners have to fork out a heftier ABSD of 15 percent, regardless of whether they are first-time buyers or landlords with multiple properties in Singapore.