On April 26th, 2023, the Singaporean Government revealed that they will be increasing the rates of the Additional Buyer's Stamp Duty (ABSD) to encourage a sustainable property market. These new rates will become effective from April 27th, 2023. The measures that were put in place in December 2021 and September 2022 have helped to control the property market to some extent. However, property prices began to rise again in the first quarter of 2023 due to high demand from locals who were buying homes for personal use, as well as renewed interest from local and foreign investors in Singapore's residential property market. If left unaddressed, there is a risk that property prices may increase excessively relative to incomes, which could result in long-term economic issues.
In order to encourage a sustainable property market and prioritize housing for personal use, the Government will be increasing the ABSD rates further to proactively manage investment demand. The specific increases for ABSD rates are as follows:
a. For Singapore Citizens (SCs) purchasing their 2nd residential property, the ABSD rate will be raised from 17% to 20%.
b. For SCs purchasing their 3rd and subsequent residential property, as well as Singapore Permanent Residents (SPRs) purchasing their 2nd residential property, the ABSD rate will be raised from 25% to 30%.
c. For SPRs purchasing their 3rd and subsequent residential property, the ABSD rate will be raised from 30% to 35%.
d. For foreigners purchasing any residential property, the ABSD rate will be raised from 30% to 60%.
e. For entities or trusts purchasing any residential property, except for housing developers, the ABSD rate will be raised from 35% to 65%.
The goal of these changes is to discourage property speculation and ensure that homes are being purchased for personal use rather than investment purposes.
The ABSD rates for foreigners buying any residential property will be significantly increased from 30% to 60%. Additionally, the ABSD rates for entities or trusts, excluding housing developers, purchasing residential property will be raised from 35% to 65%. The main objective of these adjustments is to discourage property speculation and promote the purchase of homes for personal use, rather than as investments.
Mindlink Editorial Team 2023