The government of Singapore has announced the increased Additional Buyer’s Stamp Duty (ABSD) and tighter Loan-to-Value (LTV) limits on Singapore property home purchases. This is an attempt to cool the Singapore property market and keep the price increases in line with economic fundamentals.
People who Get Affected
The current 0 to 5 per cent ABSD rates of Singapore citizens and permanent residents purchasing their first residential Singapore property investment will remain at bay.
Meanwhile, ABSD rates for other individuals or foreigners will be raised by five percentage points and ten for entities.
Additional ABSD of 5 per cent to developers looking to purchase Singapore real estate investment for house development.
LTV limits for mortgage equity withdrawal loans of borrowers who are acquiring another residential Singapore will be tightened to 75 per cent. This is if the borrower doesn’t have outstanding loans.
45 per cent increase will be applied for borrowers buying Singapore property as another residential home. This is if the borrower has outstanding loans.
What the Officials Said
“The sharp increase in prices, if left unchecked, could run ahead of economic fundamentals and raise the risk of a destabilising correction later, especially with rising interest rates and the strong pipeline of housing supply,” said by the Ministry of Finance, the Ministry of National Development and the Monetary Authority of Singapore in a media release held on Thursday, July 5.
“The government will continue to monitor the property market and adjust our policies as necessary, to maintain a stable and sustainable property market.”
Prices of Singapore real estate private homes have significantly increased to 9.1 per cent last year. Also, the number of transactions continues to rise. This is a strong recovery from the declining Singapore real estate market that began five years ago. The sudden changes made by Singapore government will take effect on July 6 and are expected to bring changes on Singapore property pricing this year.
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