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December 8, 2011, 12.03 pm (Singapore time)

Harsh property cooling measures; slowdown in private property expected

By YEO AIQI


P & N Holdings Pte Ltd, a holding company of PropNex Realty, on Thursday said that the harsh cooling measures are expected to lead to a slowdown in Singapore's private property.

Transaction volume in the private property segment is expected to fall by 40 per cent in the core central region and mass market segment volume is expected to drop 20 per cent.

Cooling measures implemented included a hefty 10 per cent increase in the stamp duty on foreigners' purchase of the private properties in Singapore. Singaporeans also have to pay more stamp duty on their second and third properties.

If foreign buyers were to sell their property within the next four years, they will pay sellers' stamp duty of 16, 12, 8 and 4 per cent in the first, second, third and fourth year of purchase, respectively. This will discourage speculators. 'Having a a blanket policy will impact the high-end market and this is detrimental as high-end homes have always been the investment interest of the foreign buyers,' commented Mr Mohamed Ismail, CEO of PropNex Realty.

He added that it is likely potential buyers will now wait for a correction first. It is projected that there will be a price correction of about 15 to 20 per cent in the central core region and 10 to 15 per cent in the mass market segment for the next six months.