Archive for category: Misc

Higher buyer’s stamp duty (BSD) rates for higher-value residential and non-residential properties in Singapore have come into effect from Feb 15, 2023.According to Tricia Song, CBRE head of research for Southeast Asia, these two adjustments could result in a 2% increase in total costs for buyers. The change in BSD rates is expected to affect 15% of residential properties and 60% of non-residential properties.From URA data, 54.7% of all private residential transactions in 2022 were valued at $1.5 million and beyond, with 15.4% at $3 million and beyond. In the non-residential space, 39.2% were valued between $1.5 million and $3 million, as observed from OrangeTee & Tie. As such, the revised rates are expected to mostly affect higher-end properties valued above $10 million.The increased BSD for higher-value properties, coupled with the higher ABSD (additional buyer’s stamp duty) from December 2021’s round of cooling measures, property tax increases announced in Singapore’s 2022 Budget, and higher mortgage rates, could further deter the overall buying sentiment, particularly in the mid- to high-end market.The revised BSD rates are likely to impact the new home sales market more than the resale market. This is especially so for the industrial sector, which saw the highest volume of transactions above $1 million in 2022 according to JLL head of research and consultancy Tay Huey Ying.Based on CBRE Research’s forecast, the increased BSD is unlikely to have a significant overall impact on the market. Average private home price growth is expected to remain at 3-5%, and new home sales volume should stay within 7,500-8,500 units. Despite the higher costs, CBRE Research still sees the industrial property sector attractively positioned.Long-term performance of Singapore’s assets is expected to remain positive due to its strong fundamentals, coupled with the anticipated continuation of rental growth. Investment volumes should pick up in the second half of 2023 once interest rates stabilise and there is more clarity on the market.Higher buyer’s stamp duty rates have come into effect from 15th February 2023 for properties of higher-value residential and non-residential properties in Singapore. These changes are expected to result in an increase of 2% in overall costs for buyers.

According to Tricia Song, CBRE head of research for Southeast Asia, the change in BSD rates is expected to affect 15% of residential properties and 60% of non-residential properties. URA data for 2022 indicates that 54.7% of all private residential transactions were valued at Tengah Plantation EC $1.5 million and above, with 15.4% at $3 million and above. In the non-residential space, 39.2% were valued between $1.5 million and $3 million, as observed by OrangeTee & Tie.

The revised BSD rates are likely to primarily impact higher-end properties valued above $10 million. Taking into consideration the higher ABSD (additional buyer’s stamp duty) from December 2021’s round of cooling measures, property tax increases announced in Singapore’s 2022 Budget, and higher mortgage rates, this could further deter the overall buying sentiment, particularly in the mid- to high-end market.

The increases in BSD are likely to impact the new home sales market more than the resale market. The industrial sector is expected to bear the brunt of the BSD change, with the highest volume of transactions above $1 million in 2022, according to JLL head of research and consultancy Tay Huey Ying.

However, CBRE Research still maintains its forecast of average private home price growth of 3%–5% in 2023 and new home sales volume at 7,500–8,500 units. The industrial property sector is still viewed as being attractively positioned even after factoring in the increase in BSD owing to the positive yield spread in spite of the higher cost of debt.

Overall, long-term performance of Singapore’s assets is anticipated to remain positive due to its strong fundamentals, coupled with the expected continuation of rental growth. Investment volumes could pick up in the second half of 2023 when interest rates stabilise, and there is more clarity on the market outlook.