‘No rationale’ for tough property cooling measures: Redas

[ginfreely]

‘No rationale’ for tough property cooling measures: Redas
By JANICE LIM

TODAY file photoVisitors at the Stirling Residences showflat on the evening the Government announced the increase in Additional Buyer's Stamp Duty (ABSD) rates and tightened Loan-to-Value (LTV) limits to cool the property market, July 5, 2018.
Published06 JULY, 2018
UPDATED 06 JULY, 2018

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SINGAPORE — The Real Estate Developers' Association of Singapore (Redas) said on Friday (July 6) that it saw "no rationale" for the fresh round of property cooling measures introduced by the Government the previous day.

On Thursday, the Government raised Additional Buyer's Stamp Duty (ABSD) rates and tightened the Loan-to-Value (LTV) limits for Singapore citizens, permanent residents, and foreigners in a bid to "cool the property market and keep prices in line with economic fundamentals".

Describing these measures as "tough", Redas pointed out that the property market is "in the early stages of a recovery and the recovery is in line with economic fundamentals".
The market should be given time "to find its own course and reach a sustained equilibrium", Redas said in response to media queries.
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The ABSD rates will be raised by 5 percentage points for all individuals, and 10 percentage points for entities. An additional ABSD of 5 per cent that is non-remittable will also be introduced for developers buying residential properties for development.
LTV limits will be tightened by 5 percentage points for all housing loans granted by financial institutions. These revised LTV limits do not apply to loans granted by the Housing and Development Board.
REDAS noted that the property market only started improving last year, helped by the overall stronger growth in Singapore's economy. It stressed that sale transaction volume is "not high and within market expectation".
"The existing sizable ABSD and TDSR remain a restraining factor for foreign buyers and Singaporeans. Buyers are still price-sensitive," said Redas, referring to the total debt servicing ratio framework which has remained in place since 2013.
Redas said it also "does not see the rationale" of the additional non-remittable 5 per cent ABSD imposed on developers buying residential properties for development. Developers are already constrained by financial considerations as well as "tough and unfriendly business policies", such as the existing 25 per cent ABSD which licensed developers can request to be remitted only if they manage to sell off all units within the five-year deadline.
"The new ABSD on developers will impose additional pressure on land acquisition as they compress their development, sales and land replenishment cycle time. Developers are concerned of distortionary effects of such market behaviour over the medium and long term," Redas added.
The association said it hopes the Government "maintains the confidence of investors and buyers as well as developers" while managing the property market. "It is in the interest of the country to have a vibrant real estate industry and a steady growth in real estate value for home owners and investors in the long term," Redas said.

 

[congo9]

Singapore already the most expensive place to stay in. If they let the price to go up, I think we citizen can treat this place like what foreigner do. Earn money and move out.

 

[ginfreely]

Singapore already the most expensive place to stay in. If they let the price to go up, I think we citizen can treat this place like what foreigner do. Earn money and move out.

From what I heard from some prcs, now Spore prices are comparable or even cheaper than Guangzhou Shanghai etc. And definitely much cheaper compared to HK. So it’s not the most expensive.

 

[bushtucker]

when the govt needs money, they don't give a shit about rationale.

Redas kena pawned.

 

[eatshitndie]

Curb on enthusiasm: Singapore property measures hit developers, investors

Vehicles pass private landed residential properties at a neighbourhood in Singapore September 5, 2016. REUTERS/Edgar Su/FilesBy Aradhana Aravindan

SINGAPORE (Reuters) - Singapore's surprise move to intensify property curbs marks the strongest cooling measures in the island nation in five years, putting a damper on a nascent resurgence in the housing market and posing risks to developers' margins.

After nearly four years of price declines, home prices in Singapore rose by 9.1 percent over the past year, while developers have been paying record amounts to buy land.
Warnings from the authorities against what one official called "excessive exuberance" in the market have mostly fallen on deaf ears, prompting government action on Thursday night. The government slapped an additional five percentage points stamp duty on property purchases for individual home buyers and tightened housing loans limits. Only first-time buyers who are Singaporeans or permanent residents were exempt from the increase. Properties bought by entities will have to pay an additional 10 percentage points.

The government also introduced an extra 5 percent acquisition tax on developers buying land to build residential properties. The shock move hit stocks of property developers on Friday and the overall market closed two percent down at a 14-month low. City Developments plunged 15.6 percent, while Oxley Holdings slumped 15.85 percent. "If the demand is not strong ... as it was over the last year, that will translate to weaker prices, hitting developers' margins," said Joel Ng, an analyst with KGI Securities. "A lot of developers had bought land at high prices expecting property prices to rise with demand."

Last-minute buyers rushed on Thursday to sign contracts for flats before the new rules kicked in at midnight. The sales launch for some projects such as Oxley Holdings' joint venture Riverfront Residences project was brought forward by two days, following the government's announcement. Local newspapers ran photos of long queues of potential home buyers lining up at showrooms of newly built condominiums to avoid the hikes in taxes.

"EN BLOC" INVESTMENTS

Oxley and City Developments are among real estate firms that have spent billions of dollars building up landbanks over the last two years through government sales or in so-called "en bloc" or collective redevelopment sales, a feature of Singapore's property market. DBS Equity Research analysts said demand for en bloc sites could "grind to a halt" due to the fresh cooling measures.

Among its measures on Thursday, the government tightened the loan-to-value (LTV) limits, which will be tightened by 5 percentage points for all housing loans.
Analysts said developers are unlikely to cut selling prices immediately. However, prices may be hit at a later stage when transaction volumes start dwindling and companies come under pressure to clear their unsold inventories.

"Margins will definitely be compressed, if developers take taking haircuts just to move volumes," said Desmond Sim, head of research, Singapore and Southeast Asia, at real estate consultancy CBRE. Developers are subject to a rule in Singapore, which requires them to sell all units in a project within a five-year deadline or be liable to pay stamp duties on the land price.

CBRE estimates developers have spent S$31 billion acquiring land over the last two years, which will yield about 30,000-35,000 homes.
"We are expecting a big conundrum of a huge supply coming in and demand taking a haircut," said CBRE's Sim.
($1 = 1.3642 Singapore dollars)
(Reporting by Aradhana Aravindan; Editing by Jack Kim and Raju Gopalakrishnan)

https://sg.yahoo.com/finance/news/c...t-developers-investors-121247053--sector.html

30k to 35k homes on the market in last 2 years. knn. sillycon valley can't even construct 3k to 3.5k homes the last couple of years. sg boleh!

 

[winnipegjets]

Which real estate lobby likes policy that hurts their business?

 

[eatshitndie]

sinkies back to their favorite pastime again - queueing to spend millions which they don't really have on hand.

 

[Seee3]

Singaporean is a weird lot. There are many clear signs but we chose to ignore.

When property is booming, so will be the COE because many make money from property to buy cars.

Recent months COE dropped which means the people do not have that spare cash for car and loan is not available. Yet they are prepared to pool their resources, max the loan so as to buy a condo in the hope for price to rise because developers said that property market is recovering. However, the govt is saying otherwise, to the extend of threatening that old flats may have no sers and end up valueless. They choose to follow the developers rather than taking the signal given by the chief controller. Really weird.

 

[Wunderfool]

Curb on enthusiasm: Singapore property measures hit developers, investors

Vehicles pass private landed residential properties at a neighbourhood in Singapore September 5, 2016. REUTERS/Edgar Su/FilesBy Aradhana Aravindan

SINGAPORE (Reuters) - Singapore's surprise move to intensify property curbs marks the strongest cooling measures in the island nation in five years, putting a damper on a nascent resurgence in the housing market and posing risks to developers' margins.

After nearly four years of price declines, home prices in Singapore rose by 9.1 percent over the past year, while developers have been paying record amounts to buy land.
Warnings from the authorities against what one official called "excessive exuberance" in the market have mostly fallen on deaf ears, prompting government action on Thursday night. The government slapped an additional five percentage points stamp duty on property purchases for individual home buyers and tightened housing loans limits. Only first-time buyers who are Singaporeans or permanent residents were exempt from the increase. Properties bought by entities will have to pay an additional 10 percentage points.

The government also introduced an extra 5 percent acquisition tax on developers buying land to build residential properties. The shock move hit stocks of property developers on Friday and the overall market closed two percent down at a 14-month low. City Developments plunged 15.6 percent, while Oxley Holdings slumped 15.85 percent. "If the demand is not strong ... as it was over the last year, that will translate to weaker prices, hitting developers' margins," said Joel Ng, an analyst with KGI Securities. "A lot of developers had bought land at high prices expecting property prices to rise with demand."

Last-minute buyers rushed on Thursday to sign contracts for flats before the new rules kicked in at midnight. The sales launch for some projects such as Oxley Holdings' joint venture Riverfront Residences project was brought forward by two days, following the government's announcement. Local newspapers ran photos of long queues of potential home buyers lining up at showrooms of newly built condominiums to avoid the hikes in taxes.

"EN BLOC" INVESTMENTS

Oxley and City Developments are among real estate firms that have spent billions of dollars building up landbanks over the last two years through government sales or in so-called "en bloc" or collective redevelopment sales, a feature of Singapore's property market. DBS Equity Research analysts said demand for en bloc sites could "grind to a halt" due to the fresh cooling measures.

Among its measures on Thursday, the government tightened the loan-to-value (LTV) limits, which will be tightened by 5 percentage points for all housing loans.
Analysts said developers are unlikely to cut selling prices immediately. However, prices may be hit at a later stage when transaction volumes start dwindling and companies come under pressure to clear their unsold inventories.

"Margins will definitely be compressed, if developers take taking haircuts just to move volumes," said Desmond Sim, head of research, Singapore and Southeast Asia, at real estate consultancy CBRE. Developers are subject to a rule in Singapore, which requires them to sell all units in a project within a five-year deadline or be liable to pay stamp duties on the land price.

CBRE estimates developers have spent S$31 billion acquiring land over the last two years, which will yield about 30,000-35,000 homes.
"We are expecting a big conundrum of a huge supply coming in and demand taking a haircut," said CBRE's Sim.
($1 = 1.3642 Singapore dollars)
(Reporting by Aradhana Aravindan; Editing by Jack Kim and Raju Gopalakrishnan)

https://sg.yahoo.com/finance/news/c...t-developers-investors-121247053--sector.html

30k to 35k homes on the market in last 2 years. knn. sillycon valley can't even construct 3k to 3.5k homes the last couple of years. sg boleh!

Lawrence Wong may risk getting boot out in the next GE for spoiling the property market recovery and spooking HDB owners.

A lot of agents are just starting to get their jobs back and now they are forced back into unemployment.

Developers are forced to pay penalties if their units remain unsold for more than 5 years after build.

HDB dwellers are told by Mr Wong that there is no value in their HDB flat after the 99 years lease is up.

Good luck Mr Lawrence Wong.

 

[mahjongking]

when developers overbid for the land, did the govt object?
knn...now they slap additional absd charges
tails you lose heads they win

 

[KuanTi01]

At times like these, WP's hammer is no match for PAP's sledgehammer; their favourite weapon of choice to quell dissent and creamed off profits for themselves.

 

[hofmann]

With the 2 largest economies in the world engaged in a trade war, these measures are prudent.

The government's message is clear and simple: don't buy now if you are not a first timer looking for a roof over your head.

 

[ginfreely]

Which real estate lobby likes policy that hurts their business?

Yes but they are stating the truth of no basis for the drastic measures as prices were dropping for 15 straight quarters and only rebounded in September last year, barely nine months ago!

Hope of rebound as private home prices end 15 quarters of decline

PUBLISHED
OCT 3, 2017, 5:00 AM SGT
FACEBOOKTWITTERWHATSAPPEMAIL

Annabeth Leow
It has been a long time between drinks, but property owners might just have reason to cheer after private home prices ticked up in the third quarter.
The rise - while modest - ended a long 15-quarter decline and fuelled hopes that a rebound is under way.
Values rose by 0.5 per cent in the three months to Sept 30 compared with the second quarter, according to flash estimates from the Urban Redevelopment Authority (URA) yesterday.

 

[bushtucker]

Singaporean is a weird lot. There are many clear signs but we chose to ignore.

When property is booming, so will be the COE because many make money from property to buy cars.

Recent months COE dropped which means the people do not have that spare cash for car and loan is not available. Yet they are prepared to pool their resources, max the loan so as to buy a condo in the hope for price to rise because developers said that property market is recovering. However, the govt is saying otherwise, to the extend of threatening that old flats may have no sers and end up valueless. They choose to follow the developers rather than taking the signal given by the chief controller. Really weird.

good example was year 2008. lehman bros sub-prime crisis, sg property price at all time low, COE was $5-10k only.

 

[Annunaki]

 

[ginfreely]

View attachment 44784

No I didn’t vote for pap but looks like no diff. Opposition or pap will all rather support this to please the 80% hdb sinkies and earn votes in the coming general election.