Tag Archive | "Singapore"

Singapore Housing Market Benefits from Good Economy

The residential real estate market in Singapore looks to continue its strong performance thanks largely due in part to a healthy economy and low interest rates. The nation experienced a record number of homes sold last year, with three thousand more homes sold in comparison to the previous year.

 

The massive improvement has been attributed to both a growth in inventory, and in overall population growth. Singapore’s economy has performed well, which has certainly impacted the success of the residential real estate market. International investors have taken particular interest in Singapore’s housing market, primarily due to the fact that the economy is healthy, and real estate in the small country is considered a safe investment. Domestic investors and homebuyers are also actively looking to buy, especially with low interest rates boosting the affordability of the market.

 

Unlike other nations in the region, Singapore’s government continues to promote the growth of its residential real estate market. Singapore has not been phased by the global threat of a debt crisis. In fact, the nation has benefitted from international investors looking to bring their money into their market.

 

The growth experienced in Singapore’s residential real estate market will likely continue throughout the next year, and into the foreseeable future. With a healthy economy, and a government that supports housing market growth, residential real estate in Singapore looks to continue to be a sound investment. There has been no talk of any potential real estate bubble, and in general, analysts and economists are both very optimistic about the market’s potential for further growth.

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Singapore Aims to Reduce Foreign Investment with New Tax

In an effort to limit foreign investment in its residential real estate market, Singapore has unveiled new taxes that will affect foreigners looking to buy homes in the country.

Foreign investors, however, are not the only group being targeted by new taxes. Corporate entities will also be subjected to the same tax. An additional tax will also be placed on permanent residents and citizens that look to buy a second and third home respectively.

Both foreign investors and corporations will be forced to pay an extra ten percent for what Singapore’s government is calling stamp duty. Those permanent residents and citizens that are looking to buy additional homes will subject to a three percent stamp duty.

Singapore’s government has decided to take such actions so as to control rapidly increasing prices in its residential real estate market. In addition, the country aims to reduce the number of foreign buyers that are investing in Singaporean real estate. Currently, foreign investors make up nineteen percent of homeowners in the country.

Analysts warn that the most recent measures could cause severe damage to the housing market in Singapore. With the new stamp duties, prices can be expected to drop into a free fall for the foreseeable future.

The actions taken by Singapore’s government strongly resemble those of China, who has imposed stringent restrictions to control rapidly rising prices. The decision to heavily curb foreign investment in the real estate market is in stark contrast to the policies of many other countries around the world that have relied on foreign investment to keep their property markets afloat.

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Singapore Becomes Latest Country to Curb Property Prices

In a move similar to that of China and Hong Kong, Singapore’s government has decided to take action against soaring property prices. In an effort to prevent that creation and bursting of a property bubble, Singapore’s government imposed a new tax on Thursday that targets foreign investors looking to buy property in the country.

According to the new policy, foreign investors must now pay an additional ten percent stamp duty on the value of the home that they are purchasing. International investors are not the only homebuyers targeted by the measure, however. Residents of the country who plan to buy more than any number of homes beyond their first must pay an additional three percent on top of their purchase price.

Property prices have risen consistently for more than two years, and are now at the highest level in history. Government officials fear that the steadily rising prices would eventually cause a crash in sales and pricing that they would not be able to control.

Analysts believe that the new government measures will likely cause a serious decline in pricing in the housing market, as international investors make up a significant portion of homebuyers in Singapore. Despite predictions of price drops, Singapore’s government is standing by the new policy. The government has stated that by enacting such a measure, they will be able to have more control over price drops, and ultimately avoid a much more detrimental crash.

China’s government has taken a similar stance with respect to property pricing drops. While China’s market is expected to drop as much as thirty percent in the next year or two, government officials are taking comfort in knowing that the declines were essentially self-impsed.

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Luxury Housing Market in China and Singapore Have Peaked

It appears that the luxury residential real estate market in both Singapore, and the major areas of China has finally peaked. Prices dropped slightly in the third quarter after many consecutive quarters during which they increased significantly. In fact, the minor price drop was the first decline in values since the beginning of 2009.

The slowdown in the market should come as no surprise, as both countries have passed legislation intended to control prices and sales in the residential real estate market. Analysts believe that the measures are working, and that prices have most certainly peaked in both regions. It is highly unlikely that both regions will soon experience a massive price increase once again.

Many analysts believe that the prices will actually drop in both regions, particularly due to the offering of discounts by developers. Rental correction will also continue to play a role in the softening of prices.

Other parts of Asia are still experiencing a residential real estate boom, particularly in the luxury property sector. Both Indonesia and India have seen their high-end real estate markets perform exceedingly well. As a result, prices in both regions continue to remain at high levels.

Many analysts have speculated over regulations put in place by the Chinese government, and have questioned as to whether or not their actions would be effective. It appears that, thus far, the restrictions have helped calm fears that the market may face a bubble. However, there is still great uncertainty as to how such measures will impact developers. Many developers have already reported significant losses, and there is fear that should the measures continue to be enforced, the developer community will suffer even more.

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