Singapore Developers Say Property Curbs Add ‘Immense’ Pressure
Singapore Developers Say Property Curbs Add ‘Immense’ Pressure
(Bloomberg) -- Singapore’s new property curbs, especially higher land taxes, will place “immense additional pressure” on developers trying to recover from the pandemic, an industry group said.
“The recalibrated tough measures are rather unexpected in view that the property market is just beginning to emerge from the challenging Covid-19 situation,” the Real Estate Developers’ Association of Singapore said in an emailed statement on Thursday. “Significant uncertainties still persist.”
Comments from the group, which represents some of Singapore’s largest developers including City Developments Ltd., come hours after the government introduced its first round of property cooling measures since 2018. The steps include raising additional stamp duties for second-home buyers and foreigners purchasing private property as well as tightening loan limits.
For developers, they have to pay higher stamp duties of 35%, up from 25%, when they purchase residential projects. They can claw back this amount if they sell all units within five years of purchasing the site, but there’s an extra 5% that can’t be refunded under a requirement introduced in the last round of cooling measures in 2018.
Seeking Leeway
The higher duties come as property firms try to compress their development, sales, project completion period and land replenishment timeframe to meet the government’s requirements, the association said.
As a result, the group is pleading for some leeway. The association renewed a call to grant temporary extensions to developers who need to sell within the five-year time frame given the construction challenges brought by the pandemic. The government currently has already been doing that.
The association is also calling on the government to consider allowing owners of public apartments upgrading for the first time to private units to defer the payment of additional stamp duties until six months after the completion of the new property.
“The property market should be allowed a bit more time to recover and reach a sustained equilibrium,” the group said.
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