Singapore | Property buyers may be caught out with the following rules

Singapore government  Announces   new property buying regulation 

New Singapore property buyer regulation announced with effect from 30^th Aug 2010  . The following regulations   are effective  . With severe shortage in HDB housing due to mismatch in supply and demand, the Singapore government hopes to use Property regulation to ameliorate a severe problem.

 Property Seller are faced with a Seller Stamp duty 

•  From 30th August 2010, seller stamp duty will be applicable within a 3 years holding period. 
• The amount payable is 1% on the first $180,000, 2% on the second $180,000 and 3% thereafter of the property price.

Cash Down-payment

The minimum cash portion of the downpayment is increased from 5% to 10% of the valuation of the property.

Loan quantum reduces from the 2nd property onwards 

The new property regulations in Singapore will hit some investors and buyers.
If you already have 1 or more outstanding  home loan, all banks and financial institutions regulated by MAS can only lend up to 70% of the valuation amount if property buyers have one or more outstanding housing loans at the time of buying another property.

The reduction  in the percentage of loan   limit for housing loans applies to the following properties: -

• Private residential properties.
• Executive Condominiums
• HUDC flats
• HDB flats
• Design, Build and sell scheme (DBSS) flats

If this is your first residential property, the loan to valuation limit remains at 80%.

Seller stamp duty Calculation
Seller stamp duty is applied on a pro-rated basis. If the property is; -

• One year holding period  – Full stamp duty is applicable
• Two year holding period  , 2/3 of the stamp duty is applicable
• Sold within the 3^rd year (i.e. > 2 year and

HDB houses – Seller stamp duty

Seller stamp duty will not affect the HDB flats as the minimum occupation period for HDB flat is at least 3 years.
For more details, please check with MAS or IRAS.
IRAS enquiries: 6351-3697 or 6351 3698
Downpayment for HUDC, HDB flats, Design, Build and sell Scheme (DBSS flats)

The cash downpayment increase from 5% to 10% of the valuation limit is only applicable to the those who has one or more outstanding housing loan at the time of applying for a housing loan for a new property purchase or those who are borrowing from financial institution regulated by MAS.: -

• Private residential properties.
• Executive Condominiums
• HUDC flats
• HDB flats
• Design, Build and sell scheme (DBSS) flats

What about first time HDB buyers?
For loans granted by HDB for HDB flats including those design, build and sell scheme (DBSS) flats. These will continue to enjoy a Loan to valuation limit of 90%.
HDB loans are offered to eligible first-time flat buyers and some second timers who are right-sizing their flats to meet their housing needs.
People who are eligible for HDB loans must first WIPE OUT all their CPF ordinary account balance before HDB loan is granted.
For those taking a second concessionary HDB loan, they must use the CPF refund and the 50% of the cash proceeds from the sale of their previous flat before they are granted a HDB loan.
Definitions
Date of purchase is deemed as the date when buyer exercise the option or signs the sales and purchase agreement, whichever is earlier.

See original: Property buyers may be caught out with the following rules