Seventh Round of Cooling Measures to Residential Property

The Singa­pore Gov­ern­ment has again intro­duced meas­ures, this time major, to cool the res­id­en­tial prop­erty mar­ket, which took effect on 12 Janu­ary 2013.

The Loan-to-Value (LTV) is now lowered fur­ther for indi­vidu­al with second and third hous­ing loans and also for non-indi­vidu­als. The min­im­um cash down pay­ment will also be increased from 10% to 25% for indi­vidu­als who are get­ting their second and sub­sequent hous­ing loans.

The sum­mary of changes is as shown in the table below:

Hous­ing Loan 1st Loan 2nd Loan From 3rd Loan
Exist­ing Revised Exist­ing Revised Exist­ing Revised
LTV Lim­it 80%; or 60% if the loan ten­ure is more than 30 years or extends past age 65 No change 60%; or 40% if the loan ten­ure is more than 30 years or extends past age 65 50%; or 30% if the loan ten­ure is more than 30 years or extends past age 65 60%; or 40% if the loan ten­ure is more than 30 years or extends past age 65 40%; or 20% if the loan ten­ure is more than 30 years or extends past age 65
Min­im­um Cash Down Pay­ment 5% (for LTV of 80%)
10% (for LTV of 60%)
No change 10% 25% 10% 25%
Non-Indi­vidu­al Bor­row­ers 40% 20% 40% 20% 40% 20%

How­ever, a bor­row­er will not be sub­ject to the lower LTV lim­it and high­er min­im­um cash down pay­ment require­ment when he obtains anoth­er hous­ing loan for the pur­chase of a prop­erty which is an Exec­ut­ive Con­domin­i­um (EC) pur­chased dir­ectly from a prop­erty developer or a HDB flat.

Next, Addi­tion­al Buyer’s Stamp Duty (ABSD) will be raised and also imposed on Per­man­ent Res­id­ents (PRs) pur­chas­ing their first res­id­en­tial prop­erty and Singa­por­eans buy­ing their second res­id­en­tial prop­erty.
The new ABSD struc­ture is as fol­lows:

ABSD Rate 1st Pur­chase 2nd Pur­chase 3rd and Sub­sequent Pur­chase
Exist­ing Revised Exist­ing Revised Exist­ing Revised
Singa­pore Cit­izens NA NA NA 7% 3% 10%
Per­man­ent Res­id­ents NA 5% 3% 10% 3% 10%
For­eign­ers and non-indi­vidu­als (cor­por­ate entit­ies) 10% 15% 10% 15% 10% 15%

Singa­por­ean first-time buy­ers of HDB flats will not be affected by the new meas­ure. How­ever, ABSD can be remit­ted for pur­chase of HDB flat/new EC by a Singa­pore Cit­izen house­hold only, upon the dis­pos­al of the first prop­erty. Mar­ried couples with at least one Singa­por­ean spouse will also be eli­gible for the refund of ABSD when the exist­ing prop­erty is dis­posed of.

An addi­tion­al meas­ure will take effect on 1 July 2013 to tight­en the terms for grant­ing HDB loans and the use of CPF funds for the pur­chase of HDB flats with remain­ing leases of less than 60 years.

Source : http://www.mas.gov.sg/News-and-Publications/Press-Releases/2013/Additional-Measures-To-Ensure-A-Stable-And-Sustainable-Property-Market.aspx