The Singapore government is taking proactive steps to cool the property market despite a dimmer economic outlook. On April 27, the Additional Buyer’s Stamp Duty (ABSD) rates were raised for Singapore citizens, Singapore Permanent Residents (PRs), foreigners, and entities or trusts.

For Singapore citizens and Singapore PRs, the ABSD rate for their second residential property has increased from 17% to 20%. For their third and subsequent property, the rate has gone up from 25% to 30%. Singapore PRs buying their third and subsequent residential property now have to pay 35% ABSD, up from 30%.

Foreigners buying any residential property now have to pay a doubled ABSD rate of 60%, up from the 30% rate that was previously in place. And entities or trusts buying any property, except for developers, will incur an ABSD rate of 65%, raised from 35%.

The property market measures implemented in December 2021 and September 2022, and the pro-active action taken by the government, appear to be having a moderating effect. However, the 1Q2023 showed renewed signs of acceleration in terms of property prices, with strong demand from local homebuyers and renewed interest from both local and foreign investors.

The Ministry of Finance, Ministry of National Development, and the Monetary Authority of Singapore noted, “If left unchecked, prices could run ahead of economic fundamentals, with the risk of a sustained increase in prices relative to incomes.”

The ABSD residential property count includes any property which is owned wholly, partially, or jointly with others. Notably, those trustees of a trust, which is not a collective investment scheme, a business trust, or a housing developer, will have to pay the ABSD (Trust) rate during the period from 9 May 2022 to 26 April 2023.

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This ABSD (Trust) rate of 5% will not be remitted and must be paid upfront at the time of the purchase. However, housing developers may be eligible for remission of their ABSD, subject to certain conditions.

Overall, these measures are a proactive step taken by the government to keep a check on runaway property prices. This article first appeared on .