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Property wishlist for Budget 2019
Some experts are hoping that the latest round of cooling measures introduced in July will be eased.
Property market watchers are looking forward to Singapore’s 2019 Budget, which is set to be delivered by Finance Minister Heng Swee Keat on Monday (18 Feb).
In last year’s budget, the government introduced several measures, including higher subsidies for HDB flat buyers, while the top marginal buyer’s stamp duty was raised from 3.0 to 4.0 percent for residential properties worth more than $1 million.
For Budget 2019, some experts are hoping that the latest round of cooling measures introduced in July will be eased. This comes after a recent study by the Real Estate Developers’ Association of Singapore and the National University of Singapore found that 95.1 percent of developers believe the measures have negatively affected the market’s prospects in 2019.
Experts also cited risks like the large supply of new property launches this year, with PropertyGuru expecting at least 40 new project launches and over 10,000 private units to be completed this year.
Despite the weaker sentiment in the private residential market, many homeowners are not giving up on their en bloc dreams. For instance, the 918-unit Braddell View is still proceeding with its collective sale tender with an asking price of $2.08 billion. Other developments have also re-launched their tenders. Some have slashed their asking prices, while others are in the process of doing so.
Meanwhile, newly released data from the Urban Redevelopment Authority on Friday (15 Feb) showed that private home sales fell by 17.8 percent to 433 units last month from 527 units in January 2018.
Amidst the many challenges facing the property market, we asked a few industry experts to share their opinions and wishes for Budget 2019.
1. Ismail Gafoor
Chief Executive Officer, PropNex Realty
“With speculations running rampant about the General Elections being held this year, it is highly unlikely that there will be further tweaking of the property cooling measures introduced last year.
“However, my suggested request would be for the government to consider calibrating the Additional Buyer’s Stamp Duty (ABSD), specifically for Singaporeans purchasing their second residential property.
“An ideal consideration would be revising the rate from its current 12 percent to possibly 5.0 percent instead. As more Singaporeans are venturing and investing abroad, they find themselves being exposed to risks beyond their control. Hence, we hope that the upcoming budget places more importance on the betterment of current and future generations of Singaporeans.”
2. Ong Teck Hui
Senior Director, Research and Consultancy, JLL Singapore
“It is hoped that SMEs, including those in the retail business, can receive enhanced financial assistance to accelerate their adoption of technology to stay relevant in the new economy.
“In anticipation of slowing economic activity, the extension of the service & conservancy charges (S&CC) rebate for HDB flats in 2019 will be a welcome relief for all heartlanders.
“Finally, we look forward to details on the flexible use of CPF funds for the purchase of shorter-lease flats in the coming budget.”
3. Christine Sun
Head of Research & Consultancy, OrangeTee & Tie
“The property cooling measures implemented in July last year have affected some groups of genuine buyers or upgraders. Currently, a full ABSD remission is only applicable to married couples who jointly purchase a residential property, and the couple must include a Singapore citizen spouse. The remission is given if the first property is sold within six months after the date of purchase of the second property for completed property or six months after the issue date of the Temporary Occupation Permit or Certificate of Statutory Completion, whichever is earlier if the property was uncompleted at the time of purchase.
“We are wondering if the authorities can extend the remission to other groups of buyers, such as Singaporean singles buying on their own or Singaporean parent and child or siblings making a joint purchase. These buyers would have similar intention of selling their current properties upon collecting the keys to their new homes, therefore they should be exempted from the ABSD.
“We are also wondering if the authorities can give a longer timeframe of perhaps eight to nine months to offload their existing homes, especially for HDB upgraders who are facing more difficulty selling their flats given the weakening HDB resale market.”
4. Eugene Huang
Head Honcho, Redbrick Mortgage
“2018 has seen multiple mortgage interest rate hikes across retail banks in Singapore. The hikes effectively raised the cost of financing a property by approximately 50 percent over the course of one year.
“The government can consider helping to slow the pace of rate hikes so that homeowners can catch up with the increased costs of home ownership. Property investors likewise may have a better chance of getting positive yield from their investment properties.”
Get more details on the property market outlook for 2019 here
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Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
