.jpg)
No tags yet.
In a short span of time, the Singapore government implemented 2 cooling measures to the property market.
First, top marginal stamp duty was raised to 4% for property value above $1m. Previously it was capped at 3%. Just a few months down the road, the government stunned the market with its new measure of the Additional Buyer Stamp Duty (ABSD). The only ones spared from paying more ABSD are local first time buyers and Permanent Residents (PR). The Loan to Value has also been reduced by to 75% for borrowers with no outstanding housing loan, and 45% for borrowers with outstanding housing loans.
With the new rulings, it is apparent that it will take a hit on the sentiment and buying interest. The market which has started to pick up some strength is likely to succumb to the new measures and slow down somewhat. The government mentioned that the action is to tame the property market from outpacing the actual economic growth. Perhaps the fast recovery in the property market calls for caution. However, some experts queried if it warrants such drastic step to cool the market at this juncture.
It is much expected that the dented demand will result in 2 things:
1. The number of transactions will slow down over the next few months.
2. The price will drift south since many will choose to stay sideline
It is the magnitude of the above 2 factors that will be a concern. The broader picture also entails the global economy where all eyes are set on the trade war between the United States of America and the Republic of China. We cannot foresee the future, but at this very moment, it shows some signs of gloominess.