Property tax changes could ease home owners’ burden but developers see limited relief

5 months ago 309

Updated

Feb 18, 2024, 05:30 AM

Published

Feb 18, 2024, 05:00 AM

SINGAPORE – Several property-related policy adjustments announced in Budget 2024 will help bring relief to many private residential home owners – who saw their property tax bills balloon this year – and single Singaporean seniors wanting to right-size their homes and shore up retirement adequacy.

Changes that would reduce the Additional Buyer’s Stamp Duty (ABSD) that developers have to pay if they are not able to sell out their residential projects within a prescribed timeline were also announced by Finance Minister Lawrence Wong on Feb 16.

But some question if the move goes far enough, given the still-punitive ABSD penalties and other challenges developers face in a slowing market and sluggish economic climate.

Analysts said the move to raise property annual value (AV) bands for owner-occupied homes will likely help ease many owners’ higher property tax burden arising from rent increases since 2022.

The URA Rental Index for all private residential properties saw a 35.3 per cent surge from first quarter 2022 to fourth quarter 2023, resulting in a jump in AVs, and affecting a larger proportion of owners than originally intended.

With the changes, owners of mid-tier private residential properties with AVs of between $50,000 and $100,000 will likely see a bigger drop in their property tax from Jan 1, 2025, Ms Tricia Song, CBRE’s head of research f...

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