The government said the new rates would impact about 10% of private property transactions. Christine Sun, the senior vice president of research & analytics at OrangeTee & Tie, called it a "freezing measure" for foreign buyers. "Luxury home sales may experience more impact and a temporary pullback in demand from these buyers."
Sun said the move could be in anticipation of more Chinese buyers — who make up the bulk of foreign luxury home purchases — in the coming months. The city-state's property market is unusually resilient, with prices rising 8.6% last year following a 10.6% jump in 2021. This contrasts with declines seen in other property markets such as China, New Zealand and Canada. Shares of Singapore property companies fell on Thursday, with City Development and UOL Group , which have large Singapore footprints, hit hardest.
A SHORT-TERM SOLUTION Analysts, however, are unsure if the new rates can really cool the market. Sun said while prices may slow for a while, the super-rich may continue to buy, keeping prices elevated. "From past experience, demand will usually rebound after a few months as supply remains low and those who need a home will still need to buy one eventually," she said. Stamp duties for foreigners were last raised to 30% from 20% in December 2021, causing a dip of 16.5% in condominiums bought by foreigners in 2022. Still, prices have not let up. Nicholas Mak, chief research officer at proptech company MOGUL.sg, said there were limitations to the measures if just 10% of purchases were affected. "There's little impact on the other 90%," said Mak, who has been analysing Singapore property for more than two decades. "If that's the case, how do you cool the market? You have a petroleum plant on fire and these people are not using the right tools to fight the fire." ($1 = 1.3342 Singapore dollars) (Reporting by Xinghui Kok and Chen Lin, Additional reporting by Rae Wee and Tom Westbrook; Editing by Sam Holmes)
