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Thread: Measures to further cool S'pore home property market

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    Default Measures to further cool S'pore home property market

    http://www.straitstimes.com/Breaking...ry_572642.html

    Aug 30, 2010

    Govt assures 'adequate' supply


    A STATEMENT released by the Ministry of National Development (MND) on Monday said that the Government will continue to ensure that there is adequate supply of housing to meet demand.

    In the second half 2010 Government Land Sales (GLS) Programme, the MND have made available sites that can yield about 13,900 private housing units, of which about 8,100 units will be from sites on the Confirmed List.

    This is the highest potential supply quantum in the history of the GLS Programme. Depending on the demand, an even larger supply of private housing may be injected in the first half 2011 GLS Programme.

    There are also 61,800 uncompleted units of private housing from projects in the pipeline as of the second quarter of 2010. Of these, 32,600 units were available or could be made available for sale.

    These comprised units that had been launched for sale by developers, units that had pre-requisite conditions for sale10 and which could be launched for sale immediately, as well as units with planning approvals for which pre-requisite conditions for sale could be obtained quickly from the Government and made available for sale.

    The Government will continue to monitor the property market closely and will introduce additional measures if required later, to promote a stable and sustainable property market.

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    http://www.businesstimes.com.sg/sub/...01632,00.html?

    Published August 30, 2010

    Another dousing to cool property market

    More flats to be built; govt looking at measures on resale deals and private housing

    By CONRAD TAN


    (SINGAPORE) The government will take further action to cool the property market and curb speculation in the resale market for HDB flats, including building 22,000 new public homes next year - up from 16,000 this year, Prime Minister Lee Hsien Loong said last night.

    'We've twice acted to cool the market - once last year, and once in February this year - but the prices are still rising,' Mr Lee said in his National Day Rally speech. 'I think we need to do more.'

    The National Development Ministry is expected to announce more details this morning, before the stock market opens.

    'I don't want to go into the details tonight, otherwise you will remember nothing else about my speech,' Mr Lee said, drawing laughter from the audience at the University Cultural Centre at the National University of Singapore.

    Private-home prices have risen 38 per cent in the year to the second quarter, according to an index compiled by the Urban Redevelopment Authority.

    Prices rose 5.3 per cent in the second quarter, only slightly slower than the 5.6 per cent increase in the first quarter. The prices of HDB flats in the secondary, or resale, market have also risen sharply in recent months.

    The government will tighten rules that allow private-property owners to buy an HDB flat in the resale market, and then sell it soon after. 'Quite a number' of private-property owners have bought HDB resale flats and then sold them after a year or two, Mr Lee said. 'I think we should tighten the rules further, so that it's quite clear that HDB flats are meant primarily for owner-occupation.'

    The surge in property prices in Hong Kong and Singapore is in part 'a reflection that there's a lot of liquidity flowing to Asia', which has weathered the financial crisis better than the United States and Europe, said Selena Ling, an economist at OCBC Bank.

    Ten days ago, the Hong Kong government announced more measures to curb speculation in its own red-hot property market, including raising the supply of land for sale and barring the resale of new condominiums before the properties are delivered.

    The government will also allow Singaporean households who earn $8,000-$10,000 a month to buy HDB flats under its design, build and sell scheme (DBSS). Such households often can't afford private homes, but could previously buy only executive condominiums from HDB, since they earned more than $8,000. The government will release more land for executive condos and DBSS flats to ensure adequate supply, Mr Lee said.

    Elsewhere in his wide-ranging speech, Mr Lee strove to reassure Singaporeans that the government would put their needs first, emphasising efforts to sharpen the distinctions between citizens, permanent residents and non-residents, as well as to protect Singaporeans' jobs.

    He hinted that the foreign-worker levy that employers of foreign workers must pay could rise beyond the levels already announced in February, making it more attractive for firms to hire local workers where they can.

    'The levies are going up, they're going to go up further - and I think they'll have to go up further beyond that in the longer term, or maybe the not so long term,' he said. 'Some employers may feel the pinch, but it is necessary because we need to manage the inflow and not have an indefinite number' of foreign workers, he said.

    Mr Lee also announced a new award, totalling $9,000, to recognise the national-service contributions of Singaporean men.

    The sum will be paid in tranches at 'major milestones' of an NSman's service into his Post-Secondary Education and Central Provident Fund accounts, Mr Lee said. The award is for citizens only; permanent residents who have done national service will receive the award when they take up citizenship. The Defence Ministry is expected to announce details this week.

    The government also expects to pay out some $400 million to 400,000 Singaporeans who qualify for the Workfare Income Supplement scheme for low-wage workers aged 35 or older this year, Mr Lee said. That scheme, too, is for Singaporeans only, and puts them at an advantage over low-wage foreigners here, he noted.

    'But the protection can only go so far,' he added. 'If you lack the skills or are not competitive, then it doesn't matter how high the foreign-worker levy is, or how generous the Workfare is, the jobs are still going to go elsewhere.'

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    Default Measures to further cool S'pore home property market

    http://www.businesstimes.com.sg/sub/...01735,00.html?

    August 30, 2010, 8.18 am (Singapore time)

    Measures to further cool S'pore home property market

    By BERNICE BONG


    SINGAPORE - The government has raised the holding period for imposition of Seller's Stamp Duty (SSD) from the current one year to three years from Monday.

    The latest move is part of the government's measures to temper sentiments in the very buoyant residential property market and to encourage greater financial prudence among purchasers.

    For home property buyers who already have one or more outstanding housing loans at the time of the new housing purchase, they will have to pay a minimum cash value of 10 per cent of the property value, up from the previous 5 per cent.

    The government has also reduced the Loan-To-Value (LTV) limit for housing loans by financial institutions - down to 70 per cent from 80 per cent. HDB loans for flats will still have an LTV cap of 90 per cent.

    Details of the measures were announced on Monday in a joint press release by the Ministry of National Development, Ministry of Finance and the Monetary Authority of Singapore.

    For residential properties bought on or after Aug 30 2010, sellers will have to pay the full SSD rate if the properties are sold within the first year of purchase - 1 per cent forthe first $180,000 of the consideration, 2 per cent for the next $180,000, and 3 per cent for the balance.

    If the property is held for more than one year and up to two years - 2/3 of the full SSD rate will have to be paid.

    If the property is held for more than two years and up to three years - 1/3 of the full SSD rate will have to be paid.

    The Government said it will also continue to ensure that there is adequate supply of housing to meet demand. In the second half 2010, it made available sites that can yield about 13,900 private housing units, the highest potential supply quantum in the history of its land sales programme.

    It added it will inject an even larger supply of private housing in the first half 2011, if demand continues to be strong.

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    http://app.mof.gov.sg/newsroom_detai...30256956123163


    Measures to Maintain a Stable and Sustainable Property Market

    Date: 30 August 2010

    1 The Government announced today the following measures to maintain a stable and sustainable property market:

    a) Increase the holding period for imposition of Seller’s Stamp Duty (SSD) from the current one year to three years.

    b) For property buyers who already have one or more outstanding housing loans1 at the time of the new housing purchase:

    i. Increase the minimum cash payment from 5% to 10% of the valuation limit2; and

    ii. Decrease the Loan-to-Value (LTV) limit for housing loans granted by financial institutions regulated by MAS to these buyers from the current 80% to 70%.

    The measures will take immediate effect on 30 August 2010.

    2 The Government's objective is to ensure a stable and sustainable property market where prices move in line with economic fundamentals. The property market is currently very buoyant. While the rate of price increase of private residential properties has moderated in the last 3 quarters, prices have still increased significantly by 11% in the first half of 2010, and price levels have now exceeded the historical peak in the second quarter of 1996.
    3 While Singapore has enjoyed strong economic growth in the first half of 2010, our economic growth is expected to moderate in the second half of the year. There are also still uncertainties in the global economy. Should economic growth falter and the market corrects, property buyers could face capital losses, with implications on their own finances and the economy as a whole. Moreover, 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. Therefore, the Government has decided to introduce additional measures now to temper sentiments and encourage greater financial prudence among property purchasers.


    Extending the Holding Period for Imposition of Seller’s Stamp Duty (SSD) on Residential Properties Sold from 1 Year to 3 Years

    4 The Government imposed in February 2010 a seller’s stamp duty (SSD) for sellers who buy residential properties3 on or after 20 February 2010 and sell them within a year of purchase.

    5 For residential properties bought4 on or after 30 August 2010, SSD will be imposed if these properties are sold within three years of purchase. Specifically, the SSD levied on residential properties will be revised to as follows:

    a) Sold within the first year of purchase, i.e. the property is held for 1 year or less from its purchase date – The full SSD rate (1% for the first $180,000 of the consideration, 2% for the next $180,000, and 3% for the balance) will be imposed.

    b) Sold within the second year of purchase, i.e. the property is held for more than 1 year and up to 2 years – 2/3 of the full SSD rate.

    c) Sold within the third year of purchase, i.e. the property is held for more than 2 years and up to 3 years – 1/3 of the full SSD rate.

    No SSD will be payable by the vendor if the property is sold more than 3 years after it was bought. Please see Annex for examples of how the SSD will be computed.

    6 The extended SSD will not affect HDB lessees as the required Minimum Occupation Period for HDB flats is at least 3 years.

    7 IRAS will be releasing an updated e-tax guide on the circumstances under which SSD will apply and the procedures for paying SSD. The e-tax guide will be available at www.iras.gov.sg. Taxpayers with enquiries may call IRAS at 6351 3697 or 6351 3698.


    Increase the Minimum Cash Payment from 5% to 10% of the Valuation Limit for Property Purchasers with one or more outstanding Housing Loans

    8 Previously, property buyers have to make cash payment of at least 5% of the valuation limit5. With effect from 30 Aug 20106, the cash payment is increased from 5% to 10% of the valuation limit7. This measure is applied only to buyers of private residential properties, Executive Condominiums, HUDC flats and HDB flats (including those under the Design, Build and Sell Scheme, or DBSS flats) who are taking housing loans from financial institutions regulated by MAS and who already have one or more outstanding housing loans at the time of applying for a housing loan for the new property purchase.


    Decrease the LTV limit for housing loans granted by financial institutions regulated by MAS from the current 80% to 70% for Property Purchasers with one or more outstanding Housing Loans

    9 The LTV limit is lowered from 80% to 70% with effect from 30 Aug 20108 for borrowers who have one or more outstanding housing loans (whether from HDB or a financial institution regulated by MAS) at the time of applying for a housing loan for the new property purchase. Borrowers who do not have any outstanding housing loans continue to have an LTV cap of 80%. These rules apply to housing loans granted by financial institutions for private residential properties, Executive Condominiums, HUDC flats and HDB flats (including DBSS flats).

    10 Loans granted by HDB for HDB flats (including DBSS flats) will still have an LTV cap of 90%. HDB loans are offered to eligible first-time flat buyers and second-timers who are right-sizing their flats to meet their housing needs. They are required to utilise all of their CPF Ordinary Account balance before HDB loans will be granted. Furthermore, those taking a second concessionary HDB loan must use the CPF refund and 50% of the cash proceeds from the sale of their previous flat before they are granted an HDB loan. This is in line with HDB's home ownership policy of helping eligible buyers, especially first-time buyers, purchase public housing in a financially prudent manner.

    11 Financial institutions' lending standards have remained prudent and the asset quality of housing loans has stayed robust, with the non-performing loans ratio at less than 1% as at Q2 2010. Nonetheless, there are signs that more housing loans are originating at higher LTV bands of above 70%. In line with the objective of ensuring a stable and sustainable property market, lowering the LTV limit sends a clear signal to financial institutions to maintain credit standards, and encourages greater financial prudence among property purchasers already servicing one or more outstanding housing loans.


    Adequate Supply in the Pipeline

    12 The Government will also continue to ensure that there is adequate supply of housing to meet demand. In the second half 2010 GLS Programme, we have made available sites that can yield about 13,900 private housing units, of which about 8,100 units will be from sites on the Confirmed List. This is the highest potential supply quantum in the history of the GLS Programme. We will inject an even larger supply of private housing in the first half 2011 GLS Programme, if demand continues to be strong.

    13 Apart from the supply from the GLS Programme, there are also 61,800 uncompleted units of private housing from projects in the pipeline as at 2Q20109. Of these, 32,600 units were available or could be made available for sale. These comprised units that had been launched for sale by developers, units that had pre-requisite conditions for sale10 and which could be launched for sale immediately, as well as units with planning approvals for which pre-requisite conditions for sale could be obtained quickly from the Government and made available for sale11.

    14 The Government will continue to monitor the property market closely and will introduce additional measures if required later, to promote a stable and sustainable property market.



    Issued by the Ministry of National Development, Ministry of Finance and Monetary Authority of Singapore


    1 Financial institutions are required to conduct checks with HDB and with one or more credit bureaus on whether the buyer has an outstanding housing loan at the time of applying for a housing loan for the new property purchase. For joint buyers, if either buyer has an outstanding housing loan, the joint buyers will be considered as having an outstanding housing loan.
    2 This is in addition to the cash over valuation amount that has to be paid in cash.
    3 The SSD will apply to the transfer or disposal of interest (including sale and gifts) of residential lands and residential units (whether completed or uncompleted).
    4 The date of purchase for computation of the holding period for SSD shall be the date when a buyer (i.e. Buyer A) exercises the option to purchase the property, or signs the sale and purchase agreement, whichever is earlier. The date of resale of the property shall be the date when the subsequent buyer (i.e. Buyer B) exercises the option to purchase the property from Buyer A, or signs the sale and purchase agreement, whichever is earlier.
    5 The amount of CPF monies plus housing loan taken for the purchase of the property cannot exceed 95% of the valuation limit (defined as the lower of property value or property price).
    6 The 10% minimum cash payment will apply to transactions where the date on which the option to purchase (OTP) was granted falls on or after 30 August 2010; or if there is no OTP, where the date of the sale and purchase agreement falls on or after 30 August 2010.
    7 Therefore, the amount of CPF monies plus housing loan that can be used for the purchase of the property will be reduced from 95% to 90%.
    8 The 70% LTV limit will apply to transactions where the date on which the option to purchase (OTP) was granted falls on or after 30 August 2010; or if there is no OTP, where the date of the sale and purchase agreement falls on or after 30 August 2010.
    9 These refer to new development and redevelopment projects with planning approvals, i.e. either a Provisional Permission (PP) or Written Permission (WP).
    10 These refer to private residential developments with Housing Developer Licence and Building Plan Approval. Under the Housing Developer (Control and Licensing) Act, a sale licence must be obtained for a project with more than 4 units, if the developer intends to sell uncompleted residential units in the development. However, the sale of the residential units can only commence with the approval of the building plans of the development.
    11 These refer to uncompleted private residential developments without pre-requisites for sale but with WP or PP granted. The sale licences could be obtained within 5 working days and building plan approvals could be obtained within 7 working days from the date of application for cases where clearances from various technical agencies are obtained and relevant documents are in order during formal submissions.

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    http://www.channelnewsasia.com/stori...077918/1/.html

    Govt introduces new measures to cool S'pore property market

    By Joanne Chan | Posted: 30 August 2010 0824 hrs


    SINGAPORE: The government on Monday introduced more measures to cool the buoyant property market.

    These include raising the holding period for which a home seller must pay a stamp duty and reducing the maximum bank loan amount for existing home owners who want to buy another property.

    The measures, which take immediate effect, came as a strong economy and low borrowing rates have continued to push property prices up, sparking concerns of a property bubble.

    Private property prices shot up by some 11 per cent in the first half of this year and have now exceeded the previous peak in 1996.

    National Development Minister Mah Bow Tan said prices are "on the high side".

    He said: "If the current momentum in the market continues, what will likely happen is that a property bubble will form. And when the bubble burst, and not if, but when the bubble burst, there will be severe implications for individuals, as well as for the economy on the whole."

    So the government has moved to curb speculation and also encourage financial prudence among buyers.

    The holding period for the seller's stamp duty has been increased from one to three years to discourage home owners from flipping. The seller's stamp duty was first introduced in February this year.

    Another measure will impact those who have one or more outstanding housing loan. Home buyers who already have at least one mortgage will have to pay more cash upfront when buying their next property.

    The minimum cash payment has been doubled from five per cent to 10 per cent of the home's valuation, while the maximum bank loan amount has been reduced from 80 to 70 per cent.

    The government said the objective of the measures is "to ensure a stable and sustainable property market where prices move in line with economic fundamentals".

    The Housing and Development Board (HDB) has also introduced anti-speculative measures to its resale market. These include increasing the minimum occupation period for non-subsidised flats to 5 years.

    Mr Mah stressed that HDB flats are meant for long-term occupation, and not for speculation. Home owners can no longer own both private property and an HDB flat at the same time during the minimum occupation period.

    So those who buy a non-subsidised HDB flat must sell off their private property within six months. Similarly, home owners of non-subsidised HDB flats will not be allowed to own private property before the minimum occupation period is up.

    These changes will only apply to those submitting flat applications from August 30 and will not be applied retrospectively.

    Mr Mah also gave the assurance that there will be more help for first-time home buyers.

    The HDB will raise the supply of flats. Up to 22,000 new Build-To-Order (BTO) flats will be made available next year.

    Together with the 16,000 BTO flats released this year, HDB will be offering more new flats over the two years than all the flats in Toa Payoh town today.

    In addition, the waiting time for a BTO flat will be reduced by six months to 2-1/2 years.

    To help the sandwiched class, those earning between S$8,000 and S$10,000 will now be eligible for flats under the Design, Build and Sell Scheme (DBSS).

    HDB will also release land for 4,000 DBSS flats and 4,000 Executive Condominiums next year.

    It said new sites for DBSS projects in Bedok, Hougang and Jurong will be put up for tender later this year. Sites in Punggol, Pasir Ris, Bukit Panjang and Tampines will also be released for the development of executive condominiums.

    - CNA/al

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    By Channel NewsAsia, Updated: 30/08/2010
    Property sales volume may dip 20%, developers likely to be more cautious

    Property sales volume may dip 20%, developers likely to be more cautious
    @import url("http://sgstc.msn.com/br/csl/css/38742CDE2D315FB67F7A0AF2CBE04B3B/fbutility.css");/*/*


    Private housing showroom



    SINGAPORE : Market watchers are not surprised by the government’s move on Monday to cool the housing market, and some even said that it is long overdue.
    On average, analysts expect the latest measures to dampen private home sales by about 20 per cent for the rest of the year.
    And developers may also hold back on new launches, and turn to preview sales instead.
    The relaxation of some housing policies will make Design, Build and Sell Scheme (DBSS) flats more accessible to Singaporeans who belong to the ’sandwiched class’ income group, earning between S$8,000 and S$10,000 and previously did not qualify to use CPF housing grants for them.
    And observers said that could shrink the pool of buyers upgrading from public housing to a private property, causing demand for private homes to soften.
    This group of buyers has been snapping up mass market private homes in the past year and fuelling price increases in the segment.
    Donald Han, regional MD of Cushman & Wakefield said: "I think mass market has come up if you’re looking at the first quarter of 2008, prices have gone up by 6—7 per cent. We probably will not expect prices to come down in the next two to three quarters, but we probably expect more stabilisation in values. After all, the market needs to take a breather.
    "And if we can contain the leap, in terms of price increases of HDB flats, I think it will put a lid on the price increases, in terms of the mass market as well."
    Analysts also expect developers to be less aggressive in their bids for state land.
    Meanwhile, the Real Estate Developers Association of Singapore (REDAS) said the latest measures may make property less affordable upfront.
    But it is confident the property market will create value for home—owners and investors in the long term.
    Overall, prices are expected to moderate with the slew of cooling measures.
    But experts are not ruling out further intervention from the government, citing concern over the huge amount of liquidity in the market and the low interest rates.
    Colin Tan, director of Research & Consultancy at Chesterton Suntec International said: "The previous measures were largely symbolic, and it didn’t quite address the liquidity problem. Right now, you have loan to value ratio of 70 per cent, and you have a minimum cash payment of up to 10 per cent, so that will at least soak up some of the liquidity.
    "If this set of measures don’t work in terms of restraining prices, we can possibly expect more measures. Going forward with what the government has mentioned — that prices have increased 11 per cent for the first half of the year — we know that a 11 per cent rise is unacceptable. So at least we now know it should be lower, much lower than 11 per cent, maybe 10 per cent for the whole year.
    According Leong Waiho, senior regional economist at Barclays Capital, price levels have now exceeded the historical peak in Q2 1996.
    Average private residential prices are up 38 per cent, compared with the trough in the same quarter in 2009. This also outstrips the growth in rental yields of 9.2 per cent on—year.
    For the second half of the year, analysts expect private home prices to grow by up to 6 per cent. — CNA /ls

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    I salute the govt for implementing the many measures to cool the property market. However, I have two concerns.

    First, what is the objective of reducing the mortgage loan amount for the 2nd property from 80% to 70%? As much as it attempts to dampen investers' momentum to rush into the property market, it effectively allows the richer investors to enter the market with less competitions and thus gaining more bargaining power on their preferred units. The not 'so rich' investors can only just watch their counterparts increase their financial portfolios. This inevitably causes the rich to get richer through property investment.

    Second, the seller's stamp duty (SSD) is imposed on those who sell their property before 3 years. This is a great move when to dampen investors' appetite when the economy is doing very well (like now). However, it will cause plenty of problem when the economy takes a dive. Some would be forced to sell their property at a great discount when they cannot finance their monthly mortgage for various reasons such as retrenchment. In the past, they might just bite the bullet and hold on for 1 full year thus saving on the stamp duty. Now, they might not have the holding power for 3 full years. As a result, they might just resort to desperate measures (which I need not elaborate).

    I strongly urge the relevant authorities to allow provisions for such dire situations. Thank you.

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    Not everyday is sunday for property speculators or punters i.e. you win some, you lose some, not guaranteed buy property everytime will win

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    Ha...relevant concerns and fears...

    1st, the LTV reduction measure is aimed at keeping those who cannot afford to play property, yet die die want to play property investors from entering the market...these jokers are borrowing really high amounts from banks (90% usually) in order to buy and flip...if interest rates low, no problem...if interest rates suddenly shoot up, can these jokers maintain their payments? not likely...gahmen is saying, enter and play only when you can afford it..so yes, you are about right that only rich can do so...yet, note that property prices can also crash...so not all property investments are sure win...so what makes you think the rich will get richer through property alone?

    2nd, the SSD scheme is calibrated...the longer you hold on to your property without selling, the less you pay the seller stamp duty...holding for 2 years before selling will let you pay less SSD compared to holding for 1 year and then sell...its an additional measure/warning to those who insist on speculating....


    Quote Originally Posted by ysyap
    I salute the govt for implementing the many measures to cool the property market. However, I have two concerns.

    First, what is the objective of reducing the mortgage loan amount for the 2nd property from 80% to 70%? As much as it attempts to dampen investers' momentum to rush into the property market, it effectively allows the richer investors to enter the market with less competitions and thus gaining more bargaining power on their preferred units. The not 'so rich' investors can only just watch their counterparts increase their financial portfolios. This inevitably causes the rich to get richer through property investment.

    Second, the seller's stamp duty (SSD) is imposed on those who sell their property before 3 years. This is a great move when to dampen investors' appetite when the economy is doing very well (like now). However, it will cause plenty of problem when the economy takes a dive. Some would be forced to sell their property at a great discount when they cannot finance their monthly mortgage for various reasons such as retrenchment. In the past, they might just bite the bullet and hold on for 1 full year thus saving on the stamp duty. Now, they might not have the holding power for 3 full years. As a result, they might just resort to desperate measures (which I need not elaborate).

    I strongly urge the relevant authorities to allow provisions for such dire situations. Thank you.

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    Reduce loan, take out the flippers and arrest the demand in sub sale market.

    Graduated tax... for those who have long term view of holding the property but had to sell due to whatever reasons.

    In fact, these are still ok as compared to setting a lower LTV limit say 50%... then you will see the effects real quickly.

    If not enough money to play, don't play.

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    http://www.straitstimes.com/PrimeNew...ry_572809.html

    Aug 31, 2010

    Govt acts to curb speculators

    New restrictions expected to cool property market; prices tipped to soften

    By Joyce Teo, Property Correspondent


    A SERIES of sweeping measures designed to take the heat out of the booming property market and rein in investors and speculators were announced yesterday.

    The buy-at-any-cost sentiment that has been boiling away in recent months is expected to take an immediate hit, with prices tipped to soften.

    The restrictions, like cooling measures last September and in February, are designed to stop a housing bubble forming.

    They target owners who try to sell - or flip - their properties for a quick buck, while those aiming to buy investment properties in addition to their existing home will find it far more costly.

    The new rules - which came in yesterday - also make it harder for Housing Board and private home owners to dabble in each other's markets.

    National Development Minister Mah Bow Tan, who announced the moves, told a briefing: 'We think that if we do nothing, there's going to be a bubble.'

    He said the 'calibrated' steps would stabilise the private property market and prevent it from overheating.

    With Singapore's strong economic growth expected to moderate in the second half, a property bubble will likely form if the current momentum in the market continues, said Mr Mah.

    'And when the bubble bursts - not if - there will be severe implications for individuals as well as for the economy as a whole,' he said.

    'Furthermore, the very low interest rates we are seeing today are not sustainable. And when they eventually rise... there will be severe implications for buyers who have overextended themselves.'

    He said the Government had taken several small steps to cool buying sentiment, unlike its 'big-bang approach' in 1996, when tough measures like a capital gains tax caused a market crash.

    'All the measures are meant to affect people who intend to buy and sell ... the speculators in the market,' he added. 'If you are a genuine buyer, if you are an owner-occupier, to all intents and purposes, these measures will not affect you.'

    Property experts believe the new rules will hit sentiment instantly, with buyers likely to hold back while prices of private homes and resale flats stabilise or even fall over the longer term.

    'We may have an extended Hungry Ghost Festival this year,' said Knight Frank chairman Tan Tiong Cheng.

    But first-time buyers will have reason to celebrate, as they may find fewer potential buyers competing with them and, possibly, softer prices.

    Civil servant Joshua Yap, 28, is one: 'I will definitely resume my house search after putting it on hold for the past few months. I am very thankful for the measures because they will serve to cool the irrational market.'

    The Government is also bumping up the supply of public housing, including executive condominiums.

    The private housing market has so far resisted two earlier rounds of cooling measures. Private home prices surged 38.2per cent in the year to June, exceeding the historical peak of 1996.

    Experts say many local buyers have been maxing out loans, but the new measures may prove a spanner in the works.

    Buyers already servicing mortgages must now fork out double the cash amount to buy a second property, so the mass market private homes segment will be hit, say experts.

    'The impact will be huge for the mass market as this is where the buyers do not have that much cash,' said a developer, adding that the market for newly-launched, uncompleted private homes will be harder hit.

    'For new project sales, I would say that the bulk of the buyers are those getting a second home. Now, upgraders will not be able to buy properties under construction if they don't have the cash and CPF savings for the 10 (per cent) and 20 per cent down payment respectively,' he said.

    DTZ's head of South-east Asia research, Ms Chua Chor Hoon, said: 'Developers are likely to lengthen the period of ongoing previews and soft launches to test the market.

    'The impact will be felt more in the public resale and mass market segments due to the double whammy of a cutback in demand and increase in supply.'

    The Real Estate Developers' Association of Singapore said the new measures may affect affordability due to the higher upfront cash component, but will not hit genuine home buyers.

    Cash-over-valuation levels in the HDB resale market are expected to dip, thanks largely to the huge upcoming supply of flats and a move barring private home owners from buying a resale flat while holding on to their private property.

    Jones Lang LaSalle's head of research for South-east Asia, Dr Chua Yang Liang, believes yesterday's measures were motivated largely by the unabated rise in public housing prices. But demand should cool for HDB resale flats.

    Some property consultants expect price rises for private homes to moderate. Jones Lang LaSalle forecasts that prices will now rise by 2-3 per cent per quarter for the rest of the year.

    Others are less optimistic. Ms Chua believes mass-market prices will slip by a few percentage points over the next six months, citing the backdrop of uncertainty in the global economy, slower sales activity and growing price resistance.

    Mr Tan added: 'When things are moving fast, there are people who feel that they are priced out of the private market. Now, their opportunity has arrived if prices flatten out or move south.'

    Property share prices fell by about 4-5 per cent in reaction to the changes.

    Asked if the new measures had to do with the upcoming general election, Mr Mah said: 'Housing has been a hot topic for as long as I can remember. (It is a) hot topic before all elections, and will be a hot topic in the next election, whenever that is.'

    [email protected]

  12. #12
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    Quote Originally Posted by Condorich
    Reduce loan, take out the flippers and arrest the demand in sub sale market.

    Graduated tax... for those who have long term view of holding the property but had to sell due to whatever reasons.

    In fact, these are still ok as compared to setting a lower LTV limit say 50%... then you will see the effects real quickly.

    If not enough money to play, don't play.
    Without those silly folks, Speculator can earn from who?
    Without Speculator, you think property will be hot like fire for you to sell at peak price?

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    Quote Originally Posted by Geylang OKT
    Not everyday is sunday for property speculators or punters i.e. you win some, you lose some, not guaranteed buy property everytime will win
    I still remember last year, all speculators and agents are singing advice
    '"Singapore will be like HongKong soon, property price will be so high untill average income earner can't afford... so be wise, buy now or else your children will not own a house when they grow up"

    Look at the sentiment now...Who can say it to me again.....

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    Quote Originally Posted by ronyyk76
    I still remember last year, all speculators and agents are singing advice
    '"Singapore will be like HongKong soon, property price will be so high untill average income earner can't afford... so be wise, buy now or else your children will not own a house when they grow up"

    Look at the sentiment now...Who can say it to me again.....
    It is still too early to conclude. Property price will crash only if economic really going south. Else it will just be a slight adjustment.

    "You need some rest in order to move even further..."

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    these measures are purely to tackle local investors

    one part of the equation everyone always fail to understand - foreign investors.
    foreign investors would compare singapore rules, tax element, entry barriers versus neigbouring countries.

    political stability is one key factor to consider. same factor you wld consider if you are investing in properties overseas.

    do you want to buy a condo in Thailand? Malaysia? Indonesia? Philippines? Hong Kong? China? Vietnam? count with one hand - how many places can an investor put their money? US/Europe - what's the breakeven period for boh economies to recover?

    agree that slight correction but how many PRs/new comers have yet to own a home?

    obvious there are still alot of buyers for good location ? but at what price? Most would say wait and wait and wait...until beh tahan...paying rent for so many years till equal to downpayment.

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    obvious in forums that some pray hard for property prices to crash....

    forgot that this comes with a price...banks are scared to lend.
    interest rates will hike
    economy goes down
    ppl will be out of job.
    lose-lose for most

    healthy correction flat growth....activities ongoing
    great

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    btw i'm indifferent since i only own i property
    cant afford

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    I guess now till end of the year will be waiting game for the market, sellers and buyers both wait and see who will can last longer.

    If no major foreign economy failure next year or sudden shock events, most probably demand will still be there and price will maintain or inch up. Many companies did well this year and will be giving fat bonus for next year. So with alot of cash around, some will still buy. However some may turn to other forms of investments as the profit from properties will take a longer time to realise as compared to previous years.

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    Quote Originally Posted by ronyyk76
    Without those silly folks, Speculator can earn from who?
    Without Speculator, you think property will be hot like fire for you to sell at peak price?
    Great to see a newbie posting on this...

    Agree with you... those Silly folks... Silly is a mild word. I prefer stupid!

    We are now at peak... the way forward is down down down... but it will recover and the future peak is higher than the current peak.. Catch it at the right time but you have to be patient and save up your cash.

    I am not sure what you think of me but I am against red hot property prices. I am for stable and gradual property prices. Of course I will be delighted if I can catch a fire sale or two... but I have no heart to see people suffer.

    If got money play.. no money don't play... can get burnt real badly.

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    nd to differentiate between buyers (local/foreign) same for sellers.
    demand from locals/foreigners or supply from foreign investors or locals
    everyone speaking in the forum is talking about locals?

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    early 2009 same comments on property prices crashing.

    then the market was even more uncertain?
    waiting for more than a year - prices beyond reach
    asia markets rebounded wah la....

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    Quote Originally Posted by dmonddd
    nd to differentiate between buyers (local/foreign) same for sellers.
    demand from locals/foreigners or supply from foreign investors or locals
    everyone speaking in the forum is talking about locals?
    WOW... great reply...

    Yes...

    Start with Singapore Citizens, then PR and then Non Citizens. Then look at Buyer and Seller perspective.

    For Buyer , look at the demand at each segment. You will have to look at their income and savings.

    For Seller, look at supply at each segment. You will have to look at their exposure to debt.

    Future Scenario

    1. Singaporean Play HDB + Private (Have to start with HDB first)

    2. Singapore PR Play HDB or Private and Private in their Country

    3. Foreigners Play Private only... Don't under estimate the power of Foreign Investors.

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    Quote Originally Posted by Condorich
    WOW... great reply...

    Yes...

    Start with Singapore Citizens, then PR and then Non Citizens. Then look at Buyer and Seller perspective.

    For Buyer , look at the demand at each segment. You will have to look at their income and savings.

    For Seller, look at supply at each segment. You will have to look at their exposure to debt.

    Future Scenario

    1. Singaporean Play HDB + Private (Have to start with HDB first)

    2. Singapore PR Play HDB or Private and Private in their Country

    3. Foreigners Play Private only... Don't under estimate the power of Foreign Investors.
    http://www.straitstimes.com/Breaking...ry_573665.html
    This means an overseas property must be sold within six months of buying a HDB resale flat. And an owner of a non-subsidised HDB flat who has yet to meet his minimum occupation period of (MOP) of five years will also not be allowed to buy a private property locally or abroad.

    PR must sell their house in their own country? dun make sense to me

  24. #24
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    Quote Originally Posted by Condorich
    Great to see a newbie posting on this...

    Agree with you... those Silly folks... Silly is a mild word. I prefer stupid!

    We are now at peak... the way forward is down down down... but it will recover and the future peak is higher than the current peak.. Catch it at the right time but you have to be patient and save up your cash.

    I am not sure what you think of me but I am against red hot property prices. I am for stable and gradual property prices. Of course I will be delighted if I can catch a fire sale or two... but I have no heart to see people suffer.

    If got money play.. no money don't play... can get burnt real badly.
    u mentioned future peak will be higher den current peak....which aso means current peak will be higher den previous peak too....so how much higher (in terms of percentage) will current peak be higher den previous 97 peak peak??

    now just surpass previous 97 peak by ard 5-10%....

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    Quote Originally Posted by devilplate
    u mentioned future peak will be higher den current peak....which aso means current peak will be higher den previous peak too....so how much higher (in terms of percentage) will current peak be higher den previous 97 peak peak??

    now just surpass previous 97 peak by ard 5-10%....
    Originally, without all these cooling measures, the market peak will likely surpass 1997 by 221% in 2016, before crashing by 45% till 2018 (see the pink graph without cooling). Then you can buy firesales during the market bottom in late 2018 (although the price will still be 77% higher than today).

    However, with cooling measures, the market will instead rise slowly and steadily by probably 77% in late 2018, and continue rising thereafter, without any opportunity for fire sales (see the blue graph with cooling).


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    if u r right....any1 sell their ppty now will nid to pay 77% more+replacement cost ard 10%

    no wonder so many water ghost waiting for replacement body

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    Was just thinking of a sticky situation here. A father bought a property recently say last year when economy hasn't recovered and for some reasons like deteriorating health, decided to quickly transfer ownership of the unit to his grown up child (not wanting to pen a will for superstitious reasons which implies that he's dying). From my simple understanding, in the past, the child will only need to fork out buyer's stamp duty based on the current valuation of the house to accept the transfer of ownership for this gift from the father. Now, the father (or the son) also has to pay the government seller's stamp duty (SSD)? Therefore, the father pays to give his property to his son who also has to pay to receive that property? Double payment? This is absurd! Is there no other way other than writing a will to simplify this problem?

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    Quote Originally Posted by ysyap
    Was just thinking of a sticky situation here. A father bought a property recently say last year when economy hasn't recovered and for some reasons like deteriorating health, decided to quickly transfer ownership of the unit to his grown up child (not wanting to pen a will for superstitious reasons which implies that he's dying). From my simple understanding, in the past, the child will only need to fork out buyer's stamp duty based on the current valuation of the house to accept the transfer of ownership for this gift from the father. Now, the father (or the son) also has to pay the government seller's stamp duty (SSD)? Therefore, the father pays to give his property to his son who also has to pay to receive that property? Double payment? This is absurd! Is there no other way other than writing a will to simplify this problem?

    occasionally we see in the caveat of ridiculously low psf ...

    i suspect its similar case .. father sell to son

    i dont think theres a law stopping such a CHEAP sale right ?
    check with lawyer ..

  29. #29
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    Quote Originally Posted by proud owner
    occasionally we see in the caveat of ridiculously low psf ...

    i suspect its similar case .. father sell to son

    i dont think theres a law stopping such a CHEAP sale right ?
    check with lawyer ..
    i was told its illegal to tx below a certain % of market value so as to pay lower stamp duty

    i noe caveat will lapse after 5yrs....so bank will lodge again after 5yrs and tat explains those low psf?

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    Quote Originally Posted by proud owner
    occasionally we see in the caveat of ridiculously low psf ...

    i suspect its similar case .. father sell to son

    i dont think theres a law stopping such a CHEAP sale right ?
    check with lawyer ..
    Asialaw Magazine March 2009
    By Sandra Han and Sharon Tan
    Parliament has passed the Stamp Duties Bill. The Bill removes the mandatory requirement of adjudication by the Commissioner of Stamp Duties (Commissioner) on any conveyance or transfer of gifts. This including the transfer of immovable properties in which no consideration, nominal or inadequate is paid. (Cases where marriage is the consideration are not covered). The amendments took effect on January 1 2009. After the Inland Revenue Authority of Singapore (IRAS) deleted Section 16(2) of the Stamp Duties Act, it published a circular on December 22 2008 explaining the new stamping procedure for any conveyance or transfer by way of gift.
    Previously, transfer documents for gift cases involving immovable properties had to be submitted to the Commissioner who would judge how much stamp duty was payable. The taxpayer’s opinion of the market value of the property (as at the date of transfer), often supported by a valuation report (as at the date of transfer), also had to be submitted to the Commissioner as supporting documents. An adjudication fee of S$90.00 was payable by the taxpayer. Notwithstanding the supporting documents, the Commissioner could request a certificate of valuation from the Chief Valuer and a valuation fee of at least S$105 for each certificate of valuation would then be payable.
    From January 1 taxpayers do not have to submit the transfer documents to the Commissioner for adjudication and can now self-assess their stamp duty. The transfer documents would then be electronically stamped without having to pay any adjudication and valuation fees. The stamp duty must be calculated based on the market value of the property as at the date of transfer. The Circular refers the market value of the property to the “price that the property might reasonably be expected to fetch in the open market on an arm’s length basis”. It is not compulsory for taxpayers to obtain a valuation report as long as the amount declared for stamping is reflective of the market value of the property (at the date of transfer). However, where taxpayers are uncertain of the market value of the property, they may still submit the transfer documents for adjudication. In that situation, the provisions set out above will still apply and taxpayers are liable to pay the adjudication and valuation fees.
    The rationale for removing the mandatory adjudication is so that taxpayers enjoy a faster transfer process - because the process may take about three weeks - and to save on adjudication and valuation fees. Parliament also outlines these further reasons: Most of the gift cases involved Housing and Development Board (HDB) flats where IRAS can easily ascertain their values through HDB’s valuation table. Secondly, most property transfers have third-party valuation reports which safeguard against the under-declaration of property values. Whilst taxpayers can save on adjudication and valuation fees, it may be prudent for taxpayers to procure an independent valuation report of the property to determine the stamp duty before proceeding to e-stamp the transfer documents. This is especially important in a volatile property market where market value of the property is difficult to determine and substantiate without engaging the professional help of independent valuers. There being no time bar for recovery of tax, duty or interest, taxpayers should be aware that IRAS will continue to conduct audit checks on conveyance or transfer documents relating to gift cases. If it discovers that there is an under-declaration of value, IRAS can recover the duty underpaid and impose a penalty of up to four times the amount of deficient duty, depending on the circumstances.
    Therefore, in the case where there are no compelling reasons to speed up the transfer process, it may be worth considering sending the transfer documents to the Commissioner for adjudication of stamp duty payable.
    This should be the IRAS Circular.
    https://iras.gov.sg/irasHome/uploade...ft%20Cases.pdf
    More information here
    http://www.iras.gov.sg/irasHome/page04.aspx?id=1974


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