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  • Writer's pictureWong Jun Jie

Mastering the Condo Market: Insights for Smart Property Investors.

Welcome to "Mastering the Condo Market: Insights for Smart Property Investors." Investing in the condo market can be a lucrative venture, but it necessitates a thorough understanding of market dynamics as well as strategic decision-making. In this article, we will look at valuable insights and strategies to help you successfully navigate the condo market and make informed investment decisions.

The Basics of Additional Buyer Stamp Duty (ABSD):

Before entering the condo market, it's critical to understand the concept of Additional Buyer Stamp Duty (ABSD). ABSD is a tax levied on property buyers who purchase their second or subsequent property. It is imposed on top of the Buyer Stamp Duty and is calculated based on the valuation or selling price, whichever is greater. ABSD was implemented by the government as a cooling measure to discourage multiple property purchases and ensure Singaporeans' housing affordability.

ABSD Rate Calculation:

Knowing the ABSD rates applicable to ifferent buyer profiles is critical for making informed investment decisions. Singaporeans are only charged ABSD at a rate of 12% on their second residential property. The third and subsequent properties attract a 15% interest rate. Singaporean Permanent Residents (PRs) pay 5% ABSD on their first property, rising to 15% on subsequent purchases. Foreigners pay a 20% ABSD rate on each property, while entities such as corporations or associations pay a 25% ABSD rate.

The Government's Position on ABSD:

ABSD is viewed by the government as an effective measure for regulating the property market and maintaining housing affordability. Despite the COVID-19 situation, no plans exist to relax property cooling measures. This demonstrates the government's commitment to ensuring Singapore's property market is stable and sustainable.

ABSD Prevention and Management Strategies:

Consider the following strategies to optimize your condo investment and avoid or minimize ABSD:

a) Select Dual Key Units: Dual key units offer flexibility as well as potential rental income. You can effectively offset your mortgage and increase your rental yield by purchasing a property with a dual key unit and living in one side while leasing out the other.

b) Investigate ABSD Refund for Married Couples: Married couples looking to buy their next home should look into ABSD refunds. This refund is available if certain conditions are met, such as selling the current residential property within six months of purchasing the second property.

c) Think about decoupling: If you and your spouse already own a home and want to buy another, decoupling may be an option. Decoupling entails giving one spouse ownership of the first property, allowing the other to purchase a new property without incurring ABSD.

d) Purchase in Your Child's Name: If your child is over the age of 21, you may consider purchasing a property in their name. Keep in mind, however, that your financial responsibility for the property remains, and your child may face ABSD in the future when purchasing their own property.

e) Separate Ownership or Sell and Buy: You can avoid ABSD by selling your current property and using the proceeds to purchase two separate homes, one in each spouse's name. Renting out one of the homes can provide extra income to help with mortgage payments.

Mastering the condo market necessitates a thorough understanding of ABSD as well as the implementation of strategic investment approaches. You can position yourself for success in the volatile condo market by considering location analysis, developer reputation, market demand, rental potential, and employing effective ABSD avoidance strategies. To maximize your returns and achieve your long-term investment goals, conduct thorough research, seek singapore real estate agent with professional advice when necessary, and make informed decisions.

When navigating the condo market, it is crucial to have the guidance of an experienced property agent who specializes in property market. As a trusted Singapore property agent, I possess in-depth knowledge of the local real estate market. With my expertise and understanding of the industry, I can provide you with top-notch property agent service as your dedicated Singapore real estate agent.


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