View Full Version : Who is paying ABSD?
$450m of ABSD
Foreigners (10%)
$261m = $2610m worth of property with average unit value of $1.86m
Singaporeans & PR (3%)
$189m = $6,300m.
It looks like the 3% ABSD is not deterring Singaporeans and PR from buying their 3rd or 2nd property. sad to say one the sucker is me.
The taxman has collected more than half a billion dollars from additional stamp duties imposed as part of property cooling measures.
The additional buyer's stamp duty (ABSD) has contributed the bulk of that - $450million between its inception on Dec 8 last year and the end of last month.
A further $51million has come from the seller's stamp duty since it was implemented in February 2010, the Inland Revenue Authority of Singapore (Iras) said. According to Iras' annual report, it collected $2.5 billion in stamp duty from sale and purchase agreements in its financial year ended March 31, 2011.
The ABSD take includes about $261million collected from foreigners who are not permanent residents (PRs), who bought about 1,400 homes in the nine months to the end of last month, Iras told The Straits Times. These foreigners comprised about one in four of the buyers who have paid the additional tax.
phantom_opera
24-09-12, 11:49
Congrats, which project u bought?? ABSD is 3%?? So BSD + ADBSD almost 5.5%?? :scared-4:
Congrats, which project u bought?? ABSD is 3%?? So BSD + ADBSD almost 5.5%?? :scared-4:
Yes. amortized it over 4 years loh..:)
phantom_opera
24-09-12, 11:58
the overall effect of ABSD is to cancel out advantages of low mortgage rate for those planning to sell after holding 4y
it is almost like buying with a 4-5% loan
Thank You for your contribution to Nation building.
the overall effect of ABSD is to cancel out advantages of low mortgage rate for those planning to sell after holding 4y
it is almost like buying with a 4-5% loan
If you dont buy, money in the bank also kenna whack by 4-5% by inflation.
Beside inflation, price and location, one other motivating factor for me was also the risk of kobi-wan increase the ABSD for SC and PR.
If you look at the numbers, $6.3b worth of property bought by SC & PR under ABSD. Assuming average unit price is $1.5m, that will translate into 4200 units. Still have sizable numbers.
phantom_opera
24-09-12, 12:24
imo, OCR has peaked at 1400psf liao .... ECO is border line liao
of course there is always hope that median salary will catch up year by year
D16 is prime of ocr. so other ocr still have room to catch up
phantom_opera
24-09-12, 12:36
you see Laguna bought that 3br at 1.37m quantum (already vvip first 50)
consider median income of family at 14k including employer CPF ... also quite stretched liao
if can loan 80% means about 1.1m loan, if interest rate is at 2%, monthly payment will be 4k, if interest up to 3% monthly payment will be 4.5k, if interest rises to 5% (which is quite normal if FD is at 3%), monthly payment is 5.7k !!! :scared-1:
you see Laguna bought that 3br at 1.37m quantum (already vvip first 50)
consider median income of family at 14k including employer CPF ... also quite stretched liao
if can loan 80% means about 1.1m loan, if interest rate is at 2%, monthly payment will be 4k, if interest up to 3% monthly payment will be 4.5k, if interest rises to 5% (which is quite normal if FD is at 3%), monthly payment is 5.7k !!! :scared-1:
if interest rate go up whole market will collapse everybody will die...ruling party kena thrown out of power...so it wont happen...:spliff:
phantom_opera
24-09-12, 14:53
if interest rate go up whole market will collapse everybody will die...ruling party kena thrown out of power...so it wont happen...:spliff:
there is a reason why Black Swan is called a Black Swan and everybody is obviously unprepared for it :scared-3:
$450m of ABSD
Foreigners (10%)
$261m = $2610m worth of property with average unit value of $1.86m
Singaporeans & PR (3%)
$189m = $6,300m.
It looks like the 3% ABSD is not deterring Singaporeans and PR from buying their 3rd or 2nd property. sad to say one the sucker is me.
i suspect Ringo33 is aka Regulator :D
buttercarp
24-09-12, 15:00
there is a reason why Black Swan is called a Black Swan and everybody is obviously unprepared for it :scared-3:
Seems like the world is united and everyone is dependent on one another.
Which is good!
Black swan could be a virus or bacterial or some alien........
if interest rate go up whole market will collapse everybody will die...ruling party kena thrown out of power...so it wont happen...:spliff:
It (interest rates rising) will happen one day but not yet. Maybe 2015-16 after the next GE. One fine day the tide will turn. But then, when it does, maybe rents will go up. So no way to predict price direction...
It (interest rates rising) will happen one day but not yet. Maybe 2015-16 after the next GE. One fine day the tide will turn. But then, when it does, maybe rents will go up. So no way to predict price direction...
Its a no brainer that what goes up must come down or vice-verse, but the million dollar questions are when and by how much.
It (interest rates rising) will happen one day but not yet. Maybe 2015-16 after the next GE. One fine day the tide will turn. But then, when it does, maybe rents will go up. So no way to predict price direction...
Where got no way to predict price direction?
Unlimited QE not sure sign meh? :scared-4:
phantom_opera
24-09-12, 17:31
It's not whether you're right or wrong that's important, but how much money you make when you're right and how much you lose when you're wrong
--- George Soros
Its a no brainer that what goes up must come down or vice-verse, but the million dollar questions are when and by how much.
Manhatten got see down meh? Even during the height of the 2009...?
if interest rate go up whole market will collapse everybody will die...ruling party kena thrown out of power...so it wont happen...:spliff:
Hard to say. We mirror us interest rates. So for now till 2015 seems safe. Thing is buyers must be mindful of their risk. No 1 to Blame if get burn. Like the YT guy. Die also must buy.
Manhatten got see down meh? Even during the height of the 2009...?
Got down abit 10-20% same for west coast San Francisco n Silicon Valley . These places recently went back up abit.
Got down abit 10-20% same for west coast San Francisco n Silicon Valley . These places recently went back up abit.
in US$ term. if you price it in gold, it will be worst.
Its a no brainer that what goes up must come down or vice-verse, but the million dollar questions are when and by how much.
Nope .. Is the question if u have the ball of steel to make that move..even the static and analysis tell is all time low...
singapore property market is the SAFEST in the world...it can be controlled by a few good men....:spliff:
http://upload.wikimedia.org/wikipedia/en/thumb/0/0c/A_Few_Good_Men_2.jpg/220px-A_Few_Good_Men_2.jpg
you see Laguna bought that 3br at 1.37m quantum (already vvip first 50)
consider median income of family at 14k including employer CPF ... also quite stretched liao
if can loan 80% means about 1.1m loan, if interest rate is at 2%, monthly payment will be 4k, if interest up to 3% monthly payment will be 4.5k, if interest rises to 5% (which is quite normal if FD is at 3%), monthly payment is 5.7k !!! :scared-1:
Unlikely for Laguna in this case, for him owning 2 properties and another one for his filial son... at least 20k or :banghead:
Nope .. Is the question if u have the ball of steel to make that move..even the static and analysis tell is all time low...
If you have money to lose you don't need balls lah. Don't confuse investment with gambling.
Want to play balls try forex. More shiok.
in US$ term. if you price it in gold, it will be worst.
True but for actual US folks it still 10-20% and inflation barely 2%. The problem for many is at the 2008 time frame many banks refuse to loan. My friend in US has perfect credit record and have Cash. The bank still wont loan then.
Unlikely for Laguna in this case, for him owning 2 properties and another one for his filial son... at least 20k or :banghead:
no worries for him he is a seasoned and savvy investor...:spliff:....or what they call in the army lau chiau....old bird...:D
$450m of ABSD
Foreigners (10%)
$261m = $2610m worth of property with average unit value of $1.86m
Singaporeans & PR (3%)
$189m = $6,300m.
It looks like the 3% ABSD is not deterring Singaporeans and PR from buying their 3rd or 2nd property. sad to say one the sucker is me.
Me sucker too...:( but bought when seller panic & prices came down by more than 3% because of the last CM... So cannot complain...:D
Hear EU FTA may be signed end of year... Very high chance Europeans will be exempt from ABSD soon.
no worries for him he is a seasoned and savvy investor...:spliff:....or what they call in the army lau chiau....old bird...:D
Will old bird kan cheong spider if correction >20% ?
Will old bird kan cheong spider if correction >20% ?
I doubt it. The bird is well diversified and has strategy to weather storms better than most of us.
Yes. amortized it over 4 years loh..:)
But 5.5% is a lot base on total quantum compred to $ park in bank. Unless u pay 100% cash
phantom_opera
25-09-12, 10:30
But 5.5% is a lot base on total quantum compred to $ park in bank. Unless u pay 100% cash
assume you buy a 600k 1br with 40% down i.e. 240k
if 240k half put in the bank half buy short term bond you probably can find a safe 1.5-2% return per year easily, if inflation at 4% you lose 2% of that 240k which is about 5k per year so in 6y time if inflation stays at 4% you lose 30k+
if you use that 240k to buy the 1br, you pay additional 3% ABSD and 2.5% BSD, 5.5% of 600k is 33k upfront lost
some way in between, you probably can go for 40k high yield stocks, 100k 2-3y bond yield 2% and another 100k 5y or 10y corp bond yield 3-4% just to beat inflation
assume you buy a 600k 1br with 40% down i.e. 240k
if 240k half put in the bank half buy short term bond you probably can find a safe 1.5-2% return per year easily, if inflation at 4% you lose 2% of that 240k which is about 5k per year so in 6y time if inflation stays at 4% you lose 30k+
if you use that 240k to buy the 1br, you pay additional 3% ABSD and 2.5% BSD, 5.5% of 600k is 33k upfront lost
some way in between, you probably can go for 40k high yield stocks, 100k 2-3y bond yield 2% and another 100k 5y or 10y corp bond yield 3-4% just to beat inflation
True
So the assumption is min hold 6 yrs at least if not the ABSD cannot not be negated. also assumption is inflation rate stay at the 4% range.
Risk will be the down side risk of buying prop at current rate might be peakish( debatable) Other is post 2015 interest rate movement might not be as low. If int rate move to 2-3% within the 6th years then ur break even need to be longer than the 6yrs. maybe add 2yrs more?
How abt Cooperate bond and rights? they are in the 3.75-5.5% range. w/o leverage.
Hard Property do have the Capital gain factor but a weak/over leverage hand might get in trouble in a down cycle. But post 4yrs if is investment rental generation would help. Provided country n economy stay on course.
anyway best is play within ones means and diversify a bit.
auroraborealis
25-09-12, 14:29
for foreigners say US or EU... the absd sort of offset their fx gains in SGD the past yr... not so much pain, just make less
for locals... the 3% absd $$$ (+ 10% from foreigners) can help govt push back GST hike plans; i think it's good in a way as it taxes the more well-to-do owning multiple properties... if GST hike, the income gap will widen further
But 5.5% is a lot base on total quantum compred to $ park in bank. Unless u pay 100% cash
Yes and no.
3% of $1m, is 30k, this is basically the only disadvantage I have for having more than 2 properties. If the property value appreciate by say 1.5% per year, it would have easily cover the ABSD within 2 years. And this is excluding the positive rental cash flow from rental, which could amount to >$1.5 per month (based on current interest rate and 60% loan).
So if we apply this over 4 years, property value appreciation will be around $60K, while positive cash flow from rental will be $72k, total $132K. And this is excluding the loan reduction from 4 years of mortgage payment.
If I put $400k in the bank, will it be able to generate $130k returns over 4 years? Perhaps yes if you are an adventurous investor.
phantom_opera
25-09-12, 15:38
Yes and no.
3% of $1m, is 30k, this is basically the only disadvantage I have for having more than 2 properties. If the property value appreciate by say 1.5% per year, it would have easily cover the ABSD within 2 years. And this is excluding the positive rental cash flow from rental, which could amount to >$1.5 per month (based on current interest rate and 60% loan).
So if we apply this over 4 years, property value appreciation will be around $60K, while positive cash flow from rental will be $72k, total $132K. And this is excluding the loan reduction from 4 years of mortgage payment.
If I put $400k in the bank, will it be able to generate $130k returns over 4 years? Perhaps yes if you are an adventurous investor.
you cannot compare putting in bank, because it entails different amount of risk. you should only compare with a portfolio that has the same risk e.g. say 30% high yield stocks, 30% 5y corp bond AA rated, the rest in junk bond :p
what the government did was trying to reduce the attractiveness of property as an investment by introducing additional risk to cancel the advantages of low interest rate
you cannot compare putting in bank, because it entails different amount of risk. you should only compare with a portfolio that has the same risk e.g. say 30% high yield stocks, 30% 5y corp bond AA rated, the rest in junk bond :p
what the government did was trying to reduce the attractiveness of property as an investment by introducing additional risk to cancel the advantages of low interest rate
So assuming if you have $400,000 today, what will you be buying?
phantom_opera
25-09-12, 15:51
So assuming if you have $400,000 today, what will you be buying?
there is no absolute answer as different people already have different assets / liabilities and different risk appetites with different inclination
it does not mean that your decision to buy a 3rd property is wrong as you may have fully paid up the other two and you may have many children so u thinking of buying for them
:D
I doubt it. The bird is well diversified and has strategy to weather storms better than most of us.
Need to frequent this forum and learn from old birds... cause Im pretty Kancheong spider lately...
there is no absolute answer as different people already have different assets / liabilities and different risk appetites with different inclination
it does not mean that your decision to buy a 3rd property is wrong as you may have fully paid up the other two and you may have many children so u thinking of buying for them
:D
If only have one prop and have 400k, will u buy? Curious to hear your respected views
Need to frequent this forum and learn from old birds... cause Im pretty Kancheong spider lately...
Mai gan cheong, coz chances are the more gan cheong the more stupid mistakes like anyhow hoot a unit will occur. In the midst of 100% sellouts, stay calm n look slowly :)
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