REDAS President Augustine Tan.
The Real Estate Developers’ Association of Singapore (REDAS) believes that the hike in buyer’s stamp duty (BSD) is unlikely to jeopardise the recovery of the city-state’s private housing market, reported the Business Times.
“The property market is in the early stages of a recovery and positive buying sentiments are likely to continue. Barring unforeseen circumstances and on the back of a stronger-than-expected economic growth outlook in Singapore, sale momentum of 2017 is likely to carry through to the next few years,” said REDAS President Augustine Tan on Friday (23 February).
However, prices of new developments here are expected to rise due to the BSD hike, coupled with the significant premiums home builders pay for housing sites. This could “add some friction to transaction volumes” as buyers are still price-conscious.
Last Monday (19 February), Finance Minister Heng Swee Keat revealed during his Budget 2018 speech that the top marginal BSD rate for residential properties costing over $1 million would be raised from three percent previously to four percent starting on 20 February.
Meanwhile, property prices in Singapore are relatively affordable versus other major cities in the world, added Tan, citing research from property consultancy JLL.
In fact, a typical house here is worth 4.8 years to five years of income compared to 8.5 years in London. That in Beijing and Shanghai is equivalent to 14 or 15 years.