S’PORE EASES PROPERTY MARKET CURBS
Govt to reduce stamp duty on sellers and relax some mortgage restrictions
SINGAPORE is rolling back some propertymarket curbs after a three-year decline in prices made houses more affordable in the city state.
Shares of property developers surged after the surprise announcement by the government yesterday that stamp duty imposed on sellers would be reduced and some mortgage restrictions eased.
City Developments Ltd jumped 10 per cent and CapitaLand Ltd climbed to the highest in almost two years.
“Singapore’s property market had been weak for a period, this is more reactionary for the Singaporean government to prop up the market,” said James Soutter, a portfolio manager at K2 Asset Management Ltd in Melbourne.
Sellers’ stamp duty, payable on residential properties sold within four years of being purchased, would now only apply for three years, said the government.
The rate of duty will also be lowered to four per cent for properties sold in the third year, to a maximum of 12 per cent for dwellings sold within one year.
The move is the first relaxation of a raft of measures to cool house prices that the government started to roll out in 2009, with some of the strictest restrictions imposed in 2013.
House prices fell three per cent last year, and have declined for 13 quarters in a row — the longest losing streak since the data was first published in 1975.
Developers weren’t anticipating the move.
“The changes were not done in a haste,” said national development minister Lawrence Wong. “Our aim is to ensure a stable and sustainable property market.”
Rules surrounding the debt-servicing ratio for some mortgages would be eased after borrowers, particularly retirees, said the rules limited their flexibility.
The changes will take effect today.
“This is positive news and would take the market by surprise because there was expectation property easing measures would be announced in last month’s budget,” said Alan Richardson, a Hong Kong-basedinvestment manager at Samsung Asset Management.
Singapore is rolling back some property-market curbs after a three-year decline in prices made houses more affordable in the city state.