Key Changes to Singapore Real Estate Rules

MND PRESS RELEASE - 30TH AUGUST 2010


KEY CHANGES TO REAL ESTATE RULES:


- Holding period for imposition of Seller’s Stamp Duty (SSD) increased from the current one year to three years.
For residential properties bought on or after 30 August 2010, SSD will be imposed if these properties are sold within three years of purchase. Specifically, the SSD levied on residential properties will be revised to as follows:

1. Sold within the first year of purchase, i.e. the property is held for 1 year or less from its purchase date – The full SSD rate (1% for the first $180,000 of the consideration, 2% for the next $180,000, and 3% for the balance) will be imposed.
2. Sold within the second year of purchase, i.e. the property is held for more than 1 year and up to 2 years – 2/3 of the full SSD rate.
3. Sold within the third year of purchase, i.e. the property is held for more than 2 years and up to 3 years – 1/3 of the full SSD rate.

No SSD will be payable by the vendor if the property is sold more than 3 years after it was bought.


- For property buyers who already have one or more outstanding housing loans at the time of the new housing purchase:
i] Increase the minimum cash payment from 5% to 10% of the valuation limit
With effect from 30 Aug 2010, the cash payment is increased from 5% to 10% of the valuation limit.  Applied only to buyers of private residential properties, Executive Condominiums, HUDC flats and HDB flats (including those under the Design, Build and Sell Scheme, or DBSS flats) who are taking housing loans from financial institutions regulated by MAS and who already have one or more outstanding housing loans at the time of applying for a housing loan for the new property purchase.
ii] Decrease the Loan-to-Value (LTV) limit for housing loans granted by financial institutions regulated by MAS to these buyers from the current 80% to 70%.
Borrowers who do not have any outstanding housing loans continue to have an LTV cap of 80%.  These rules apply to housing loans granted by financial institutions for private residential properties, Executive Condominiums, HUDC flats and HDB flats (including DBSS flats).
Loans granted by HDB for HDB flats (including DBSS flats) will still have an LTV cap of 90%. HDB loans are offered to eligible first-time flat buyers and second-timers who are right-sizing their flats to meet their housing needs.

***The measures will take immediate effect on 30 August 2010