ABSD: Singaporeans buying 2nd property to pay 20%; doubled for foreigners
The ABSD rate has been increased from 30 to 60 per cent for foreigners purchasing any residential property.
SINGAPORE – Singaporeans who are buying their second residential property will be subject to an Additional Buyer’s Stamp Duty (ABSD) rate of 20 per cent – up from 17 per cent – from Thursday (27 April).
Those buying their third and subsequent property, as well as Singapore permanent residents (PRs) buying their second property, will have to pay an ABSD rate of 30 per cent. This is an increase from the previous 25 per cent.
In a statement released before midnight Wednesday, the Ministry of Finance, Ministry of National Development and Monetary Authority of Singapore said that the increases are to "promote a sustainable property market" and "prioritise housing for owner-occupation".
Despite property market measures implemented in December 2021 and September 2022, which have had some moderating effect, property prices "showed renewed signs of acceleration amid resilient demand" in the first quarter of 2023.
"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 authorities 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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Additional rate changes are:
Increase in ABSD rate from 30 per cent to 35 per cent for PRs purchasing their third and subsequent residential property.
Increase in ABSD rate from 30 per cent to 60 per cent for foreigners purchasing any residential property.
Increase in ABSD rate from 35 per cent to 65 per cent for entities or trusts purchasing any residential property, except for housing developers.
No change in rate for first property purchase
Based on 2022 data, the authorities said, the current ABSD rate increases will affect some 10 per cent of residential property transactions.
There will be no change to the ABSD rates for citizens (no ABSD) and PRs (five per cent) purchasing their first residential property. This group constitutes about 90 per cent of residential property transactions based on 2022 data.
For acquisitions made jointly by two or more parties of different profiles, the highest applicable ABSD rate will apply.
Those buying a HDB flat or executive condominium unit from housing developers with an upfront remission, are not currently affected by the ABSD, if any of the joint acquirers or purchasers is a Singapore citizen.
The revised ABSD rates will apply to all residential properties acquired on or after 27 April 2023.
There will be a transitional provision, where the ABSD rates on or before 26 April 2023 will apply for cases that meet all these conditions:
The Option to Purchase (OTP) was granted by sellers to potential buyers on or before 26 April 2023.
This OTP is exercised on or before 17 May 2023, or within the OTP validity period, whichever is earlier.
This OTP has not been varied on or after 27 April 2023.
Increase in housing supply
The authorities said that they have "increased the supply of private housing on the Confirmed List to 4,100 units for the 1H2023 Government Land Sales (GLS) programme, from 3,500 units for 2H2022". In 2022, the authorities had put in a total of 6,300 units under the Confirmed List.
"For public housing, we have launched more than 23,000 flats in 2022 and will launch up to 23,000 flats in 2023. We are also prepared to launch up to 100,000 new flats in total between 2021 to 2025."
"The government will continue to adjust our policies as necessary to ensure that they remain relevant, and promote a sustainable property market," the authorities said.
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