Property cooling measure round #8: Capital Gains Tax...?

It is a well-publicized fact that Singapore do not have a capital gains tax regime. Even our Malaysian neighbour has a Real Property Gains Tax, which imposes a 15% tax on gains from sales of property bought within 1 -2 years; 10% for those bought within 3 - 5 years and zero tax if one has held on to the property for more than 5 years.

One of our readers has suggested that the most effective way to cool our red-hot property market is via a capital gains tax. 

The wife and I must admit that we do not know enough on the subject and our quest for answers (from the internet) thus far has revealed little.

So we are opening the questions to our readers:

1. Do you feel that a capital gains tax will be more effective than the measures that have been implemented (e.g. lower LTV, additional stamp duties) to cool the property market?

2. If so, why has the Government not taken revisited this option?

Resale home prices dropped 0.3% in Dec 2012!

Prices of private resale homes dropped 0.3% in December from November.

This is according to the latest Singapore Residential Price Index (SRPI), which tracks prices of completed private apartments and condominiums.

The SRPI data is published by the Institute of Real Estate Studies at National University of Singapore (NUS).

Analysts said the drop may be due to lower transactions during the school holidays in December.

They added that when volume is lower, prices tend to be flat or register a small decline.

Resale prices of private homes in the central area saw the biggest decline, down 1.3% last month.

But prices of units in the non-central region went up by 0.5%.

Meanwhile, the index covering small units of 506 square feet and below remained flat last month.

DWG Real Estate senior manager Lee Sze Teck said: "For January 2013, the prices for small units could see a rise because of the lower loan-to-value (LTV) ratio implemented on 12 January 2013."

He added: "Buyers are likely to adjust their budget downwards because of the lower LTV ratio and look to buy smaller units."

In contrast, data compiled by the Urban Redevelopment Authority showed private residential property prices grew 1.8% in the last quarter of 2012.

Mr Lee said that the difference between the two data "could be due to NUS revising their base to March 2009."

Source: Channel News Asia

 

This just in: 4Q 2012 home prices rose 1.8%

Private home prices rose 1.8% in the fourth quarter of 2012, compared to a 0.6% increase in the previous quarter.

But for the whole year of 2012, prices of private residential properties increased by 2.8%, a smaller rise compared to the 5.9% growth recorded in 2011.

The Urban Redevelopment Authority (URA) on Friday said that prices of non-landed properties outside the central region rose 3.8% in the fourth quarter, compared to an increase of 1% in the third quarter.

Prices of non-landed properties in the core central region edged up 0.7% in Q4. For the rest of the central region, prices increased 0.9%.

Rentals of private homes climbed 0.7% in Q4. For the full year, private home rentals rose 2.1%, compared with the 3.8% increase in 2011.

Source: Channel News Asia

 

 

 

We were Yahoo-ed!

THE wife and I were told that our recent blog entry entitled "A home buyer's lament: Here's some relief?" was featured in Yahoo! Singapore News today. While we are strong advocate of information sharing and have no qualms about agreeing to requests from other blogger/blog site to repost our entries, today's feature did catch us totally by surprise.

THE wife and I decided to take a peek at the Yahoo! Singapore News article and besides having quite a few chuckles over the various comments made on the article, we have these thoughts:

1. Yes, we do not have all the answers but then again, we never profess that we do.

2. We have always maintained that whatever we have written are strictly our opinons, so anyone taking what we said as facts is either a huge fan (one can always hope!) or he/she truely believes that we make (some) sense. But nobody is pointing a gun at anybody to take what we said as the gospel truth.

3. Even if we are wrong (which certainly will happen from time to time and if so, we really don't mind being corrected), we hope our entries will at least invoke responses from people who may have the correct answers. This will provide opportunities for those who don't know to learn from those who do.

4. We appreciate someone educating us on the difference between "unusable" and "unhabitable" space. But if AC ledge is indeed classified as "unhabitable space", then we are really surprised when the same someone claimed that "most projects do not have unhabitable space to begin with" - THE wife and I probably need to get our heads checked because if our memories served us right, most of the new projects (including "shoeboxes") that we had seen over the past 3 years have rather large AC ledge/space.

5. We are also grateful to be taught the difference between "covering over" and "enclosures". Having said that, nobody ever said anything about "covering up of roof terraces". Despite our limited English abilities, we believe that "having covered structures built on top of open roof terraces" is quite different from "covering up of roof terraces". And if anyone still insists that the former is prohibited in older estates, he/she has obviously not been to Lakeview Estate!

6. And before this becomes the subject of another Yahoo! News Singapore article (or the National Conversation, for that matter), THE wife and I wanna go on record to say that there is just THE one and only wife... and we shall leave it at that.

 

 

New project sales status: Q Bay Residences 61% sold!

Q Bay Residences at Tampines has sold 312 out of its 510 launched units as of Monday, after its launch last weekend.

The project is jointly developed by Fraser and Neave (F&N), Far East Organization and Sekisui House.

It is the first private residential project to be launched since the latest round of property cooling measures introduced by the government.

According to a statement released by F&N on Tuesday, the units were sold at an average price of $1,007psf.

Q Bay Residences was launched at an average selling price of $985psf from an originally planned price of $1,050psf.

Excluding Q Bay Residences, F&N said it has a total unsold inventory of 299 units, or about 5% of projects currently under development.

The unsold inventory is primarily from the eCo, Palm Isles, Seastrand and Flamingo Valley private residential projects.

F&N said it plans to launch its remaining site in Woodlands by the second quarter of 2013.

The conglomerate acquired the site in October 2012 at $302psf ppr.

This will be jointly developed with Lum Chang Binjai Holdings, and is expected to yield around 500 units.

F&N has a 70% effective interest in this site.

Source: Channel News Asia

So who says a little more discount won't work...?