Singapore's Housing Market: A Review of Recent Government Measures
Several measures have been implemented by the Singapore government over the years to keep housing prices in check when they exceed economic fundamentals. Let's take a look at some of the most recent developments.
The increase in additional buyer's stamp duty (ABSD) rates, which goes into effect on April 27, 2023, is one of the most recent measures. Foreign buyers, entities, and trusts will now pay double the original ABSD rates, while Singaporeans purchasing a second property will see an increase from 17% to 20%, and third or subsequent properties will see an increase from 25% to 30%. ABSD rates for permanent residents (PRs) will rise from 25% to 30% for second properties and from 30% to 35% for third or subsequent properties. Meanwhile, foreigners purchasing any residential property must pay a whopping 60% ABSD, while corporate entities and trustees purchasing residential property must pay 65%.
Another measure that will go into effect on September 30, 2022, is tightened borrowing limits and a 15-month wait period for private property owners who want to switch to public housing. The benchmark interest rate used to calculate the total debt servicing ratio (TDSR) was also raised, from 3.5% to 4% for homes and from 4.5% to 5% for non-housing property. A new 3% rate was introduced for HDB flats to determine how much a borrower can handle in HDB loans, with the loan-to-value limit for HDB loans reduced to 80% from 85%.
The government raised ABSD rates and tightened borrowing limits on December 16, 2021. ABSD rates for Singaporeans purchasing a second property increased from 12% to 17%, and rates for third or subsequent properties increased from 15% to 25%. ABSD rates increased from 15% to 25% for PRs purchasing their second property, and from 15% to 30% for third or subsequent properties. ABSD rates for foreigners purchasing any residential property increased from 20% to 30%, while corporate entities purchasing residential property had to pay 30% ABSD. The TDSR threshold was also reduced from 60% to 55%, as was the loan-to-value ratio for HDB loans from 90% to 85%.
In addition to the government measures put in place to cool the housing market, it's critical to work with a reputable and experienced agent who can guide you through these changes and secure the best deal for you. I have a proven track record of success in the Singapore real estate market as an award winning condo/hdb agent.
As an experienced real estate agent have assisted numerous clients in the purchase, sale, and rental of real estate, providing exceptional service and tailored solutions to meet their specific needs. With my extensive market knowledge and countless award winning property agent i am dedicated to my clients' success, I am confident in my ability to deliver results. I am here to help you every step of the way, whether you are looking to buy your dream home or sell your property for the best price. Please contact me today to find out more about how I can help you with all of your real estate needs.
Finally, the Singapore government has put in place a number of measures to keep the property market stable, with a focus on reducing demand from foreign buyers and investors. Property buyers and sellers must stay current on the latest regulations and policies in order to make informed decisions and avoid potential pitfalls.
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