SINGAPORE: There is no rationale for the new housing curbs given that the Singapore property market "is in the early stages of a recovery and the recovery is in line with economic fundamentals", said the Real Estate Developers' Association of Singapore (REDAS) on Friday (Jul 6).
The statement from the industry body came a day after the Government announced new property cooling measures.
Among the curbs are a 5 percentage point hike in Additional Buyer's Stamp Duty (ABSD) rates for citizens and permanent residents (PRs) buying second and subsequent homes, as well as a 5 percentage point tightening for loan-to-value limits for all housing loans granted by financial institutions.
Analysts have described the measures as heavy-handed.
REDAS said that the property market only started to see improved sentiments in 2017 on the back of brighter forecasts for the Singapore’s economy which expanded 3.5 per cent by the end of 2017 and 4.4 per cent in the first quarter of 2018.
It added that sale transaction volume is not high and within market expectation given that the property market has been in the doldrums since 2013.
“The existing sizable ABSD (Additional Buyer’s Stamp Duty) and TDSR (Total Debt Servicing Ratio) remain a restraining factor for foreign buyers and Singaporeans. Buyers are still price-sensitive,” REDAS said.
The organisation is of the view that the property market “should be allowed time to find its own course and reach a sustained equilibrium”.
REDAS also said it does not does not see the rationale of imposing additional measures on developers.
“As is, in the purchase of sites from the GLS (Government Land Sales) programme or private collective sites to replenish their land bank to keep operations going, developers are constrained by a confluence of financial considerations as well as tough and unfriendly business policies including the existing ABSD on developers and the Qualifying Certificate (QC) punitive conditions on majority of developers (who are deemed foreign companies).
"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.