reporter2
03-06-14, 14:59
http://www.straitstimes.com/archive/tuesday/premium/singapore/story/review-property-cooling-measures-foo-mee-har-20140527
Review property cooling measures: Foo Mee Har
Published on May 27, 2014 2:04 AM
SOME property market cooling measures should be reviewed to make it easier for more Singaporeans to upgrade their homes, Ms Foo Mee Har (West Coast GRC) said in Parliament yesterday.
This would help give more Singaporeans "a chance to realise their aspirations and 'level up'", she said during a debate on the President's Address.
For instance, additional buyer's stamp duty (ABSD) could be collected upon the completion of a new property rather than upfront, she said.
And if a genuine upgrader sells his first flat within a certain period, he should not need to pay ABSD at all.
Singaporeans pay no ABSD on their first home purchase, but incur a 7 per cent levy when buying a second home.
Upgraders can already get an ABSD refund if they sell their HDB flat within six months of getting a private home, subject to certain conditions.
Ms Foo noted yesterday that property upgrading has become "much more difficult for the middle income group", due to recent property market curbs such as ABSD, loan-to-value (LTV) limits and a total debt servicing ratio (TDSR) framework which caps home buyers' total debt repayments at 60 per cent of gross monthly income.
"This aspiration to upgrade is important to the middle class; many had worked hard towards this goal, only to be frustrated just when they thought it was within reach." She added that although TDSR was important to keep home buyers from taking on too much debt, it has "already raised the bar for many".
The "combined burden" of lower LTV ratios and having to pay ABSD upfront would usually put an upgrade out of reach, she said.
She suggested that the Government allow a higher LTV ratio of 80 per cent for those upgrading to a private home who ultimately end up owning only one property.
The LTV ratio indicates how much cash a buyer has to put down when buying a home. A lower LTV ratio means buyers have to use more of their own cash rather than borrowed money to finance home purchases.
MELISSA TAN
Review property cooling measures: Foo Mee Har
Published on May 27, 2014 2:04 AM
SOME property market cooling measures should be reviewed to make it easier for more Singaporeans to upgrade their homes, Ms Foo Mee Har (West Coast GRC) said in Parliament yesterday.
This would help give more Singaporeans "a chance to realise their aspirations and 'level up'", she said during a debate on the President's Address.
For instance, additional buyer's stamp duty (ABSD) could be collected upon the completion of a new property rather than upfront, she said.
And if a genuine upgrader sells his first flat within a certain period, he should not need to pay ABSD at all.
Singaporeans pay no ABSD on their first home purchase, but incur a 7 per cent levy when buying a second home.
Upgraders can already get an ABSD refund if they sell their HDB flat within six months of getting a private home, subject to certain conditions.
Ms Foo noted yesterday that property upgrading has become "much more difficult for the middle income group", due to recent property market curbs such as ABSD, loan-to-value (LTV) limits and a total debt servicing ratio (TDSR) framework which caps home buyers' total debt repayments at 60 per cent of gross monthly income.
"This aspiration to upgrade is important to the middle class; many had worked hard towards this goal, only to be frustrated just when they thought it was within reach." She added that although TDSR was important to keep home buyers from taking on too much debt, it has "already raised the bar for many".
The "combined burden" of lower LTV ratios and having to pay ABSD upfront would usually put an upgrade out of reach, she said.
She suggested that the Government allow a higher LTV ratio of 80 per cent for those upgrading to a private home who ultimately end up owning only one property.
The LTV ratio indicates how much cash a buyer has to put down when buying a home. A lower LTV ratio means buyers have to use more of their own cash rather than borrowed money to finance home purchases.
MELISSA TAN