Govt may still relax property curbs this year

Consultants believe the government will tweak the measures if condo prices drop significantly.

Experts still believe the government may ease its property cooling measures later this year or in early 2017, despite the lack of goodies announced for the property sector in Budget 2016, and the higher foreign worker levies in the construction sector, reported Singapore Business Review.

“We expect the government to continue monitoring the residential market, and relaxation is likely only nearer end-2016,” said RHB Research in a report.

The consultancy thinks authorities will likely tweak the property curbs if home prices drop by 12 to 15 percent from its peak.

The government may also review the measures if developers can no longer bear the extension fees that they must pay for failing to dispose residential units within a stipulated period under the Qualifying Certificate (QC) and Additional Buyer’s Stamp Duty (ABSD) rules.

Meanwhile, Maybank Kim Eng reckons the reason why the cooling measures are still in place is because home prices remain too high. It also shows that authorities are satisfied with the low number of non-performing housing loans and high leverage mortgages.

“Further downside should be expected before any lifting is made. This is in line with our view that there is not enough pain in the market yet and cooling measures may only be reviewed in early-2017.”

But if Singapore’s economy takes a turn for the worse and drags down home prices, the government may prioritize lifting the curbs, added Maybank Kim Eng.

Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories email romesh@propertyguru.com.sg

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