By Forbes Staff Jonathan Burgos
The Marina Bay Sands hotel and casino and the Merlion statue in Singapore, on Tuesday, May 14, 2024. … More
漏 2024 Bloomberg Finance LP
Shares of Singapore鈥檚 biggest developers fell on Friday after the government introduced new measures to curb housing prices in one of the world鈥檚 most expensive property markets.
The government raised the stamp duty for investors who sell their private homes within four years, according to a joint statement from the Ministry of National Development, Ministry of Finance and Monetary Authority of Singapore late Thursday.
Under the new rules that will take effect from today, those selling their property within one year of purchase will have to pay a 16% tax from 12% previously. The holding period for homes that will incur the stamp duty has also been extended to four years from three years previously.
Shares of developers fell in Singapore midafternoon trading. City Developments declined 3.3%, while those of UOL Group slipped 2.9% and Frasers Property fell 0.6%.
The government is introducing fresh measures to tame the increasing subsales鈥攖he practice of selling uncompleted residential developments for a quick profit鈥擫eonard Tay, research head of Knight Frank in Singapore, wrote in an emailed statement. From just 198 transactions in 2020, the number of sub sales jumped to 1,428 in 2024, it noted.
鈥淭he government is not taking the risk of subsales pushing up prices, even though this might-or-might not happen and has decided to increase the holding period and seller鈥檚 stamp duty rates,鈥 Tay wrote.
While the number of new private home sales dropped to a five-month low in May, prices remained resilient, rising 0.5% in the second quarter from the previous three months, according to preliminary data released by the government this week. The government has been trying to rein in property prices with a number of cooling measures such as higher levies on foreign buyers that was introduced in 2023.
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The government鈥檚 fresh property curbs should have a muted impact on the housing market, Vijay Natarajan, an analyst at RHB Investment Bank in Singapore, said. 鈥淲e believe the majority of buyers at new launches are genuine home owners,鈥 he said. 鈥淔urthermore, the ramp-up in new home supply over the last two years and a volatile macroeconomic condition has reduced the allure of speculative purchases at new launches.鈥
Following a lull in new launches in recent months, some developers have unveiled new projects recently. Frasers Property鈥攃ontrolled by by Thai billionaire Charoen Sirivadhanabhakdi and his family鈥攁nd Japan鈥檚 Sekisui House have started marketing the 348-unit The Robertson Opus, a residential and retail complex, along the Singapore River near the Raffles Place central business district.
City Developments鈥攃ontrolled by billionaire Kwek Leng Beng and his family鈥攊s preparing to launch the 706-unit Zyon Grand near the Orchard Road shopping district in the second half. UOL Group鈥攃ontrolled by the family of late banking and real estate tycoon Wee Cho Yaw鈥攊s also planning to market the 301-unit Upperhouse residential tower on Orchard Boulevard later this year.
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