SINGAPORE, Feb 23 (Reuters) - Singapore’s increase in stamp duty on expensive home purchases was unlikely to derail a recovery in the city state’s housing market, the head of a property developer’s association said on Friday.
The government this week raised the stamp duty on the portion of a residential property’s value above S$1 million ($761,615) to 4 percent from 3 percent.
“Although the new revised buyer’s stamp duty hike may add some friction to transaction volumes and buyers are still price-sensitive, it is unlikely to derail the recovery,” Augustine Tan, president of the Real Estate Developers Association of Singapore, said in a speech.
“In the purchase of sites from the government land sales programme or private collective sites, the substantial premiums paid by developers for residential sites, together with the 1 percent hike in the buyer’s stamp duty may translate into higher prices for new projects in the future,” Tan added.
His comments come as Singapore’s housing market is showing signs of a recovery, with private homes recording their first annual price rise in four years in 2017, and as property firms paid record sums to buy sites to develop. (Reporting by John Geddie Editing by Shri Navaratnam)