Government Should Stop Punishing New Home Buyers

The Govt has on Thursday, 5th July introduce another new round of Additional Buyers’ Stamp Duty or ABSD.

Again the target is on buyers! Instead of helping its people to own their private homes, it decides that their best policy is to go after its citizens.

A new homeowner who has sacrificed 2.5 years of his youth in national service and ran a great risk of never returning alive and who is not qualified to buy a Govt-built HDB flat.

This is a Singaporean patriot and the 1st person Govt thinks of is to punish such a guy.

As if this is not enough, it has also asked the banks to lower the lending threshold to 3/4 of an allowable loan.

The borrowing is further reduced by the bank if big balcony space is provided in your new apartment. This is considered non-living space. Imagine?

Another severe punishment to a guy who is in his early 30s and has just settled down. Think no babies to serve national service! Hey, this is real!

The Govt should stop punishing its citizens. It should not be greedy to sell land costing billions of dollars and expect developers to sell the apartment cheaply?

The Govt should be more creative and proactive by finding ways to help this group of patriots in their 1st home purchase instead. It can augment them Govt-sponsored loans or subsidies, similar to those offered to 1st time HDB owners.

How about not allowing developers to buy more land if they have a high number of unsold flats from previous land purchase! It is quite obvious why they have lots of vacancy units?

Or better still, impose fines on them each day for their unsold flats?

These are some measures which the Govt should consider and not going after 1st time property buyers by increasing ABSD?


Gilbert Tan



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17 Responses to “Government Should Stop Punishing New Home Buyers”

  • Rabble-rouser:

    The whole property market had become an unregulated casino because of a racketeering situation.
    This recent private property bull run which started with a EnBloc surge in 2017 had no market fundamentals. Truth was that the Developers had ganged up to ramp up a 5-yr stagnant property market using the EnBloc process as fuel to lit up the market. Racketeering!
    Knowing the KIASU nature of S’poreans & rich S’pore-based foreigners of a runaway S’pore property market – it worked! Now it was more like a herd of liquidity flushed investors attending new launches in masses looking to book units like it were a leh-long sale. It had become a Stampede of a mindless herd.
    The unexpected announcement came last Thursday 5/7/18 of higher stamp duty rates and tougher loan-to-value measures for buyers ran counter to the bouyant property market sentiment. It was extremely harsh but when the property market was running wild without any market fundamentals to back – it was a correct though belated move abide the wrong measures on the little guys. You see, S’pore is a crony capitalist economy. The big guys don’t get admonished nor punished – it’s the little guys who get the short end of the stick & get whacked for it.
    We’re into the midst of a Global Trade War being instigated by War Mongering US President Trump against China. And the global interest rate cycle is turning upwards.
    MAS became extremely concerned because they are the monitors for the S’pore Economy. Any resultant defaults from the Euphoric property buying will have extremely devastating effect on both the property market recovery & the banking sector.

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  • Think and vote wisely:

    A PAP minister said “You do not need a lot of space to make babies”. Property developers are building more shoebox sized and small units for investors, singles and also young couples, also for divorced old men old women who need to have some discreet privacy with their girl or boy friends.
    The powerful and the rich (that includes PAP Ministers) scratch each others back. When prices rise, land prices rise, property developers make tons of money, government revenue grows, GIC and Temasek Holdings can borrow more money, GDP grows, PAP reward themselves generously.
    People work harder to achieve their dream of owning their first home or second property or more.
    Of course, children of wealthy parents may get help to buy a private property.
    When prices rise rapidly, PAP will pretend to be the “Robinhood”. The sheep will vote them like in GE2015.
    When prices decline, PAP again play the good guy, freezing land sale or reduce land sale, relax QC and stamp duties rules for the property developers, and loan and duties rules for buyers.
    A small token relax on tax last year, coupled with reduced land sale by the government amongst other factors already results in euphoria and panick buying – one thousand condo units were sold in less than 5 hours on 5 July.
    This is Singapore, we have to accept that 70% give PAP the mandate, even if PAP has been playing a dirty political game to grip onto power for over almost 6 decades.

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  • oxygen:

    PROPERTY MARKET IN LEE-jiapore is EUPHORIC in emotional term.In financial terms, it is a BUBBLE about to implode.


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  • LIONS:

    Whats wrong with collecting more money,Gilbert?

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  • Just rmbr to vto:

    Everday they just come up with a thousand ways to suck as much (blood) money from us sgs.
    Another good reason to vto.

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  • Gan Loong Ching:

    So many en bloc has taken place. So many families need to buy new apartments. An additional 5% increase to ABSD will fetch how much more money for the greedy gahmen? If this is not the time to collect easy money, when is?

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  • LIONS:

    This isnt about COOLING the market.
    This is about collecting more $$$.
    The greedy Pig$ know full well there is pent-up demand n so easy money for them?

    Vote P$P,you get Pig$.
    Its your choice.

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  • Bapak:

    No, they will not change cause Sinkies given them the mandate to do so. They punished you and yet you vote for them, wow I don’t know what to say.

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  • To Gilbert:

    The main problem is PAP is too pro-business and pro-rich because 70% give them the mandate to do so.
    PAP allow companies to employ foreigners to displace Singaporeans.
    PAP make sure banks and property companies make money.
    Will it allow DBS, Capitaland, Keppeland to fail? If it ever happens, civil servants like MAS Menon and ministers like Lawrence Wong and PM’s aspirant Heng will be axed because Temasek Holdings’s returns on investment will plunge!
    Will it allow CityDev, Ho Bee (whose ceo is chairman of PAP RC/CCC Chairman), HPL (whose ceo brought in F1 and sold luxury condo to PM and his family members at steep discounts), Wing Tai (whose Chairman is Temsaek Holdings deputy Chairman) to fail?
    Prices are high and people panick to buy because demand exceeds supply.
    PAP control land supply to developers who bid record prices.
    Developers in turn sell at higher price to buyers. Will PAP want the developers to sell at a loss resulting in risk to the banks as well?
    Developers have PAP on their side to sell their units (from launch to completion and thereafter) in phases (including balances like HDB) despite the QC – stamp duties can be made remissible or waived, penalty exempted at the discretion of PAP.
    In fact, the longer the developers wait to sell, the more profits they make – the land the developers bought prior to 2013 is a lot cheaper than the price of land now.
    It cannot be that the developers have a lot of vacancy units because those land bought prior to 2013, their QC is ending soon or has ended, and yet the developers are not selling these units.
    When the rich like UOB Wee family bought some block of properties or development project for a few hundred million dollars, did it have to pay any stamp duties like an individual buyer? Developers can sell project or units to other developers within the QC to avoid QC penalty. Laws are made by PAP that can change at its will.
    Subsidies are just nice term PAP use to win votes. It gives PAP excuses to charge the masses more and push up market prices. Are our HDB flats really subsidized?
    EC are deemed as subsidized vis a vis condo, are they really cheap or affordable?
    PAP and the PAP controlled media keep harping that first time owners will not be affected by all these so called cooling measure. Look at it at another angle, if property price drops over the next few years like 2013-2017, is PAP doing these first time owners a disservice? It entices them who feel lucky, to buy but price drops after they buy.
    Sometimes, when things become so entrenched and irreversible, we need a reset, to avoid disruptions like communism takeover prior to 1970s or people power, aka revolutions after 1980s.

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  • HarderTruths:

    What about old home buyers? We are punished too!

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  • N.Jungne:

    It is mainly making money, otherwise what?

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  • RDB:

    How many of the GE2015 69.9% voted for Pee And Poo know such things? If they are smart, we would be having WP+SDP as a coalition govt already? And they will not compromise us as they know they’ll be out at the next GE!

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  • Dont daydream:

    The rich have the ears of PAP.
    REDAS openly criticized the latest measures. Anyway, it is wayang.
    The last people PAP listens to will be Opposition and anti-PAP individuals.
    Transport Minister can’t even penalize obike for accusing LTA and threatening not to return deposits to users, he has to refer to Ministry of Trade where the future PM heads!

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  • Simple Reason!:

    New Condos are not solely meant for Singaporeans!

    They are meant for rich FTs who will eventually become New Citizens!

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  • Hagen-diaz:

    The Monetary Authority of Singapore (MAS), came up with an obviously bogus national rationale for ABSD, LTV tariffs it wanted to impose for other reasons. There are several rebuttals to that rationale: The ABSD increase is intended to hit certain target groups where it hurts. These groups are: a) En-bloc owners with ready cash but not affected by LTV, looking for alternative homes and still stuck with 1st homes. They had no choice but to pay the extra stamp duty e.g. $1million 2nd home will now cost $1.12million.
    b) HDB dwellers hoping to upgrade to a $1million condo, in addition to paying the ABSD of $120,000, must come up with hard cash of $280,000 before borrowing the rest from banks.
    All these measures ONLY affect Singaporean buying second residential PRIVATE property. Property Developers now also has to pay the incredible 30% ABSD along with already raised Development Charges (DCs). Based on these, the likely effects of this major round of cooling measures dwelt a death knell for the En-bloc fever and 1st time private property buyers. PS – this is not in lieu of Govt. ripping-off some profits from those ‘bo-pian’ En-blockers and forcing 1st time buyers to reconsider taking up those vacant BTO hdb properties. I know that’s cold comfort. . We now have a bear market in housing. That is, there’s a good chance the home they own – or will buy – will be worth less next year, And perhaps the years after that.

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  • Rabble-rouser:

    I’ve never seen a more convoluted property market than S’pore’s with numerous rule changes & constant govt meddling. Markets being markets should be transparent & have a simple set of rules & regulations which should not be changed unless absolutely necessary. As I see it, there a tonne of disincentives for home buyers unless he/she is a (virgin) first-time buyers & a local to boot. But that is like a camel threading through a needle’s eye. Local graduates are frankly, marginalised by the employment market biased towards foreigners. Only a very small percentage can afford to ‘buy’ private property ie. rich families with family businesses – the children employed within & are given a big salary to boot. They are the ones who can go to the bank & borrow millions to buy private properties. But those who were property investors see different!
    The increasing punitive stamp duties on both sides of the property transaction coupled with weak capital asset prices (stagnant) are making property investments a fading one (looking at negative returns & potential capital losses going forward ). Those who had sold off their property portfolio Post-2013 cooling measures must be counting their blessings. No matter what, they find solace not being a property investor these days – very soft rental market (rentlords subsidizing tenant), increasing holding costs, prospect of higher interest rates, rental yield absolute bottom or even negative. There’s hardly any incentives in getting back into the property market.
    At times, I find the S’pore Property Market puzzling (???). The local property demographics factor is already saturated with high % of home ownership (over 90% either ‘own’ HDB flats or private properties). Yet the govt (under URA) allowed continual construction of new residential properties (SUPPLY) via GLS & ex-EnBloc acquisitions. The China capital flight phenomenon is over! Yet the PAP govt is suppressing the domestic buying market (DEMAND) for new housing. It begs the question, How is the looming housing supply going to be taken up?
    And without the Investment side taking market risk & the slack, I’m afraid that the S’pore property has no legs to stand on. A property market that has continual govt intervention & various govt meddling measures is not a market at all.

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  • Haigen-diaz:

    The contagion of escalating ‘trade wars’’ will ricochet in both the US & Europe, and Asia where growth remains on a weak wicket. This is all the more so in industries like property/banking whose failures will have wider ramifications in rattling the macroeconomic fundamentals of our home ownership. Profit maximization that is caused by reckless risk-taking without regard to the erosion of the industry will lead to socially horrendous results if not held in check. Anyway, you can’t legislate away stupidity and greed and risk-taking and recklessness. The outrageous fact is that nobody in a position of responsibility even tried to untangle the devil knot that binds MAS and government together. Check-and-Balances have been forsaken for political expediency. All specialize there only in the devices, stratagems, and techniques of plunder of successful en-bloc beneficiaries and new housing allocations for another 2 million imported residents.

    At times, I find the S’pore Property Market puzzling (???). The local property demographics factor is already saturated with high % of home ownership (over 90% either ‘own’ HDB flats or private properties). Yet the govt (under URA) allowed continual construction of new residential properties (SUPPLY) via GLS & ex-EnBloc acquisitions. The China capital flight phenomenon is over! Yet the PAP govt is suppressing the domestic buying market (DEMAND) for new housing. It begs the question, How is the looming housing supply going to be taken up?
    And without the Investment side taking market risk millions & the slack, I’m afraid that the S’pore property has no legs to stand on. A property market that has continual govt intervention & various govt meddling measures is not a market at all.

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