MEASURES TO MAINTAIN A STABLE AND SUSTAINABLE PROPERTY MARKET
13 January 2011
1 The Government announced today the following measures to maintain a stable and sustainable property market:
1. Increase the holding period for imposition of Seller’s Stamp Duty (SSD) from the current three years to four years;
2. Raise the SSD rates to 16%, 12%, 8% and 4% of consideration for residential properties which are bought on or after 14 January 2011, and are sold in the first, second, third and fourth year of purchase respectively;
3. Lower the Loan-To-Value (LTV) limit to 50% on housing loans granted by financial institutions regulated by MAS for property purchasers who are not individuals1; and
4. Lower the LTV limit on housing loans granted by financial institutions regulated by MAS from 70% to 60% for property purchasers who are individuals with one or more outstanding housing loans2 at the time of the new housing purchase;
The measures will take effect on 14 January 2011.
2 The Government's objective is to ensure a stable and sustainable property market where prices move in line with economic fundamentals.
Previous Government measures have to some extent moderated the market, but sentiments remain buoyant.
Low interest rates plus excessive liquidity in the financial system, both in Singapore and globally, could cause prices to rise beyond sustainable levels based on economic fundamentals.
Moreover, when interest rates eventually rise, it could strain purchasers who have overextended themselves financially.
Therefore, the Government has decided to introduce additional targeted measures to cool the property market and encourage greater financial prudence among property purchasers.
source: Ministry of National Development, Singapore