- Buyers of 2nd homes can borrow up to 70 pct, from 80 pct
- Stamp duty on sellers who buy and sell within 3 years
- Aimed at speculators, won't hurt home buyers - analysts
- Singapore property stocks fall on new measures
- Singapore moves follow similar steps by HK, China
SINGAPORE/HONG KONG - Singapore announced on Monday restrictions on people buying second homes as part of new measures to cool its red-hot residential market, joining Hong Kong and China in taking steps to keep a lid on housing prices.
Home prices in Asia have soared in recent months, fuelled by the region's rapid economic recovery and ultra-low interest rates. The gains have been highest in Singapore, where prices rose 34 per cent in the 12 months to June, followed by Hong Kong which increased 21 per cent, according to Global Property Guide.
Part of the demand has come from wealthy Chinese individuals looking to diversify geographically by putting money into the two ethnically Chinese cities, which impose few restrictions on property investments by overseas investors.
"This latest move is not to discourage home-buying on the whole. It is aimed at property investment, especially short-term ones," said Nicholas Mak, former head of research at Knight Frank in Singapore and now a lecturer at Ngee Ann Polytechnic. Hong Kong tightened mortgage lending this month for bigger apartments as prices headed for historic highs, while China is clamping down on bank lending to the property sector as well as making sure developers do not hoard land meant for housing development. However, South Korea is taking a different path, announcing on Sunday it would ease some mortgage borrowing restrictions for low income earners buying homes for their own use. In Singapore, the new measures included decreasing the amount those with existing mortgages can borrow to buy second properties to 70 per cent from 80 per cent, and extending a stamp duty to sellers who buy and sell within three years. The stamp duty was previously imposed on speculators who disposed of their homes within one year. Singapore property stocks fell after the government's announcement, with shares of Southeast Asia's second-largest developer City Developments falling as much as 4.3 per cent and Wing Tai dropping as much as 4.6 per cent. CapitaLand, Southeast Asia's largest developer, declined as much as 2 per cent. The worst-hit counters were those with large exposure to Singapore residential property, said DMG & Partners analyst Brandon Lee. AFFORDABILITY Analysts said Singapore appeared more concerned about ensuring home prices remained affordable for the majority of citizens rather than asset inflation, noting the new measures did not attempt to stem inflows from overseas. The measures, they added, come on the back of an announcement by Singapore Prime Minister Lee Hsien Loong on Sunday that the government will build 22,000 new public homes next year, up from 16,000 this year, in a bid to ensure housing remains affordable. "We've acted twice to cool the market - once last year and once in February this year - but prices are still rising," Lee said. "We need to do more." Chua Yang Liang, head of Southeast Asia research at Jones Lang LaSalle, noted that while the pace of price increase in private residential property has moderated, resale prices of government-built HDB apartments continued to rise strongly. "The latest introduction of measures are motivated largely by the unabated rise in public housing prices," he said, noting the 4.1 per cent increase in HDB resale prices in the second quarter exceeded the average of about 3.0 per cent in preceding periods. Chua predicted Singapore home prices will continue to rise but at a slower pace, with private home prices moderating to 2-3 per cent growth per quarter and HDB prices rising 1-2 per cent. Singapore said on Monday it introduced the new measures "to ensure a stable and sustainable property market where prices move in line with economic fundamentals". Singapore interest rates are near record lows despite economic growth that will likely hit 12-15 per cent this year, due to an increase in inflows from overseas. Malayan Banking, for instance, earlier this month launched home loan packages in Singapore with first-year rates of as low as 0.88 per cent per annum. "The current low global interest rate environment will not continue indefinitely, and higher interest rates could have severe implications for buyers who have overextended themselves," the Ministry of Finance, Ministry of National Development and Monetary Authority of Singapore said in a joint statement.
Ref:business.asiaone
Aug 30,2010
A whole bunch of changes in rules were made during the National Day Rally 2010. It affects both HDB and private property owners. Here is a summary of the changes: 1. If you buy a HDB resale flat now with no HDB loan or grant, you now have to occupy it for 5 years before you can sell your flat. (Previously, you need only occupy the unit for 3 years.) 2. Households earning $8k-$10k now eligible for DBSS, and $30k CPF housing grant. Must take private bank loan. 3. 16,000 more new flats will be offered this year, and up to 22,000 next year, pending demand. 4. BTO flat owners can now collect their keys 6 months earlier. This means they need only wait 2.5 years for their new flat, versus the current 3 years. 5. Private property owners who buy resale HDB flats must now dispose of their private property within six months of purchase. This is to prevent private property owners from buying HDB resale flats for investment purposes. (Previously, private property owners need not dispose of their private property, if their HDB is primary residence.) 6. All buyers of HDB flats now have to meet 5 year minimum occupation period (MOP) before reselling the flat or before they can invest in private property. (Previously, resale flat buyers who have not taken a HDB grant or HDB loan can buy private property for investment immediately, and sell their HDB flat after 3 years) 7. Seller’s Stamp Duty (SSD) is now applicable to any seller who sell their property within the 1st 3 years. (HDB sales are not affected due to MOP of 3 or 5 years). (A) SSD is calculated as:
- 1% for first $180,000
- 2% for next $180,000
- 3% for balance.(B) If property sold within:
- 1st year = Full SSD
- 2nd year = 2/3 SSD
- 3rd year = 1/3 SSD 8. If you have an outstanding housing loan and wish to buy a second property, a 30% downpayment is now needed (at least 10% cash, with balance payable with CPF). Those with no outstanding housing loan, 20% downpayment remains. See complete news for more details:
- More help for first timers ( link)
- HDB to raise income ceiling ( link)
- HDB market set to cool ( link)
- MND announces measures ( link)
Ref:singaporewatch.org
|
No comments:
Post a Comment