new cooling measures effective 8dec 2011

[wind30]

Good move by govt. think long term guys! We want serious foreign investors, not flight speculators that flee at any shakeup. Pple are exiting the money markets and there's a huge flood of liquidity flowing into our shores. Our govt need to act fast and this is swift and commendable. Developers ( FEO, pls hear this) will also stop inflating psfs that suit the Chinese market eg 1600psf at Telok Kurau!!!

why does these measures attract "serious" investors????

It just deter ALL foreign investors.... got "not serious" investors meh?

[edwinleeap]

It may signal housing loan interest rates will remain low for quite a while. Hence the need for these quantum measures.

[fiat500]

why does these measures attract "serious" investors????

It just deter ALL foreign investors.... got "not serious" investors meh?

it has become more like our taxis here already..so many surcharges here n there until the foreigners are confused.

[buttercarp]

They should review case by case basis.
If foreigner enrols his kid for school here, and whole family uproot and stay here, then should consider lower ABSD or no additional at all if it is 1st property.

[fiat500]

They should review case by case basis.
If foreigner enrols his kid for school here, and whole family uproot and stay here, then should consider lower ABSD or no additional at all if it is 1st property.

At the end of the day,they just want yr $$$ lah..
Just pay n pay..simple.

[kane]

Redas should ask developers don't be so aggressive I'm bidding for land. And don't price to the max when selling. The numbers are too glaring.

[DC33_2008]

The cooling measure is very effective. One stone kills many birds. In a way, it is good for most Singaporeans.

Citizens now got privileges liao. less foreigner buy = more pple rent?

Is PAPs helping Singaporeans become landlords? if property price drop 50%. I am quiet sure someone will lose their remaining 60% ****.

now PR status is very expensive liao lor. Can get 10% discount on property! invest 10m and get 10% discount when u buy a holiday home!

[solsys]

The cooling measure is very effective. One stone kills many birds. In a way, it is good for most Singaporeans.

Quite a good measure, looking from several angles. Citizens happy, new PR, newer citizens, who only own 1-2 properties as of now lagi more happy.

With the exception of property agents I guess, the smart ones will be planning to do rental deals already......

Seriously, I think agents are earning too much, i.e. 1-2% of a 2 million property is alot of commission. Before the ABSD, i think they earn nearly half as much as the government's stamp duty.

[fiat500]

The cooling measure is very effective. One stone kills many birds. In a way, it is good for most Singaporeans.

Y is that so? Care to elaborate?

[kane]

So if the developers absorb the stamp duty, then it'll probably feel like there was no additional buyer stamp duty. But that'll mean lesser margins for them. I guess they can afford 3% off from their margins to move the inventory.

I wonder whether we'll see more inventive layout with bigger and "improved" air con ledges.

[phantom_opera]

See if you are a family comprising of 1 SPR and 1 citizen currently owning HDB, you will still get hit by this extra 3% stamp duty when buying PC, unless you sell off HDB first.

This will kill off medium term speculators completely, the transaction cost is simply too high especially for new units under construction:

1. Buyer stamp duty around 2.5%
2. Additional stamp duty 3%
3. SSD of 4y
4. LTV 60%
5. To sell must pay agent 2%
6. After 4y, already paid bank interest probably 1-2%

Overall upfront cost for investment is 2.5+3+2+2 = 9.5% with low leverage due to LTV 60% The investment property must go up 15% in 4y just for you to have kopi $$ profit

[peterng8]

See if you are a family comprising of 1 SPR and 1 citizen currently owning HDB, you will still get hit by this extra 3% stamp duty when buying PC, unless you sell off HDB first.

this type of people dont want to convert to citizen yet want to enjoy the best of both world...deserve to get hit and hit them hard...this is the message loud and clear....

[avo7007]

To be fair I think the CM also help prevent these foreign investors from over investing in our pty mkt and getting burnt later. I think the most upset person right now is BJT......

[wind30]

They should review case by case basis.
If foreigner enrols his kid for school here, and whole family uproot and stay here, then should consider lower ABSD or no additional at all if it is 1st property.

then convert to PR lor.... case by case basis, you think so free to look at all the appeals meh?

[wind30]

quite surprised by the recent cooling measures.

I think its effect is more dramatic that the previous ones due to it timing.

People are already wondering whether to relax some of the cooling measures, etc. The government all of a sudden whack another tough measure. I think this will weigh heavily on people's mind as the potential for MORE measures are very high.

[radha08]

Those investing in properties who buy now are 'fools' according to one guy. Those who believed that and waited are greater 'fools'? Must be now.

Message is clear. Property is for living in, not for investment or passive income.

YES SIR i receive message loud n clear...

[SpinCity]

Ya,i think they are too intelligent already..
Imposing 10% additional sd on foreigners is very harsh..
This will wipe out buying interest from indons,malaysians,indians n chinese..
Imagine having to fork out another 120k for nothing for a 1.2m property..who will be so smart to invest here anymore?

I think what's worse is the policy risk. Investing in SG is more and more like investing in Malaysia properties
It is politically correct to make housing affordable, but the price tag is that Singapore residential properties may be off from foreign investors' radar screen
Once bitten twice shy. let's see if foreign investors will ever come back

[Lovelle]

Thought have to be malaysian then can enjoy the high interest, no?

no need bah

[phantom_opera]

I think what's worse is the policy risk. Investing in SG is more and more like investing in Malaysia properties
It is politically correct to make housing affordable, but the price tag is that Singapore residential properties may be off from foreign investors' radar screen
Once bitten twice shy. let's see if foreign investors will ever come back

That's why CCR will be hardest hit .... loss of confidence in capital growth potential, OCR is normally for rental play still ok

[hyenergix]

MMs in RCRs and OCRs near MRT will hardly be affected. Developers will simply hold back from price increase and dangle more discounts for larger units.

[phantom_opera]

This is definitely not a pro-rich policy, high inflation of 5+X% every year ... still take away the only safe asset class that is hedging inflation

CityDev down 7.5% already ... probably 10% down today

[SpinCity]

So if the developers absorb the stamp duty, then it'll probably feel like there was no additional buyer stamp duty. But that'll mean lesser margins for them. I guess they can afford 3% off from their margins to move the inventory.

I wonder whether we'll see more inventive layout with bigger and "improved" air con ledges.

developers may absorb the ABSD, but for those who buy from developers, by the time they want to sell, they have to absorb the ABSD and potentially pay the SSD. All buyers will think twice before they sign

[fiat500]

I think what's worse is the policy risk. Investing in SG is more and more like investing in Malaysia properties
It is politically correct to make housing affordable, but the price tag is that Singapore residential properties may be off from foreign investors' radar screen
Once bitten twice shy. let's see if foreign investors will ever come back

They should just fine tune d hdb system n not interfere too much on private properties.
Afterall they are private n should just let d mkt force dictate its direction.
Perhaps just change ltv to 50% for foreign buyers instead of 10% sd.

[equalizer]

Xiao....seems like another knee jerk measure motivated by political/election concerns. This is at odds with foreign policy and certainly going to send confusing messages to foreign investors and potential immigrants.

On the one hand, want to encourage foreign talent and investment. On the other hand, make it expensive for them to afford accomodation

Then when market crash and foreign investment dries up, they will scurry to remove all the measures or even add incentives. Instead of trying to even out the ups and downs, they are making the swings more extreme.

.

[Regulators]

How is that good for singaporeans when the million dollar property you own becomes less desirable for foreigners to buy?

The cooling measure is very effective. One stone kills many birds. In a way, it is good for most Singaporeans.

[hopeful]

1) if people buying fewer properties, and taking out fewer mortgages, what is the banks going to do with the excess funds? FD rates going to be lower? lower mortgage rates?

2) why won't developers jackup the price and absorb stamp duties. Afterall valuers go along with any price developers/banks ask for. So this measure increase new sales at the expense of subsale and resale.

before (BSD borned by buyer)
$1mil property, cash outflow = 20% DP + 3% BSD = 200k + 24600 = 224600

after (all BSD absorbed by developer).
$1.06mil property, cash outflow = 20% DP = 212000

[SpinCity]

That's why CCR will be hardest hit .... loss of confidence in capital growth potential, OCR is normally for rental play still ok

If only for rental play, why come to Singapore? the rental yield is not that great compared to other part of the world
What if next CM come in to tax foreigners the property tax at 100% of annual value? Only investors become cautious about the policy risk, they may not come in at all

[heroes]

I believe this is a smart move from gov.. With additional10% can make foreigner think twice to sell their properties. It will make price stable. Also can match the demand n supply cos developer also hold new launch.

For landlords also good .. Foreigner better rent then buy. IMHO

[SpinCity]

This is definitely not a pro-rich policy, high inflation of 5+X% every year ... still take away the only safe asset class that is hedging inflation

CityDev down 7.5% already ... probably 10% down today

just bade high for the Alexandra site and now all of a sudden CM5 comes
maybe CDL will do service apartment instead of residential units

[avo7007]

1) before (BSD borned by buyer)
$1mil property, cash outflow = 20% DP + 3% BSD = 200k + 24600 = 224600

after (all BSD absorbed by developer).
$1.06mil property, cash outflow = 20% DP = 212000

Isn't LTV 60% for 2nd pty, and stamp duty should be BSD (3%) + ABSD (3%)? Quite a big cash outlay.....