Singapore’s government, in a bid to cool down the housing market, has doubled the stamp duty for foreigners buying a house in the city-state. The government has pitched the move as an effort to “promote a sustainable property market and prioritise housing for owner-occupation.”
The revised rates will take effect from April 27, 2023.
Singapore Property Market: Revised stamp duty rates
The government has now doubled the stamp duty to 60 per cent for foreigners buying home.
For the Singapore citizens, it has raised the tax to 20 per cent from 17 per cent earlier for a second residential property. It was increased to 30 per cent from 25 per cent for the citizens purchasing their third or subsequent home, and for permanent residents purchasing a second residential property.
The Singapore citizens do not need to pay any stamp duty while buying their first residential property as was the case before.
The government said that married couples with one of them a Singapore citizen, who jointly purchase a second residential property, can continue to apply for a refund of the stamp duty, “subject to conditions”. These conditions include selling their first residential property within 6 months after the date of purchase of the second residential property.
Singapore Property Market: Why revision of stamp duty rates?
The latest measures for a “sustainable property market” in Singapore follow tax increases that were imposed in December 2021 and a tightening of home-loan limits in September 2022, Bloomberg reported.
The city-state’s property prices have remained dynamic despite slowdowns in parts of the world due to increased interest rates and inflation.
Despite a “moderating effect” from the previous increases, property prices last quarter showed “renewed signs of acceleration amid resilient demand,” the Singapore government’s statement said.
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“Demand from locals purchasing homes for owner-occupation has been especially strong, and there has also been renewed interest from local and foreign investors in our residential property market,” the government said.
“If left unchecked, prices could run ahead of economic fundamentals, with the risk of a sustained increase in prices relative to incomes.”
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