Aug 30 Measures Start Yielding Results
On Aug30 government of Singapore announced very severe measures to control the speculation practices in in the real estate business so as the prices are inexpensive to all and the investment in the business remains secured with no prejudice to the national economy. Besides other measures, The Housing and Development Board (HDB) had also announced the penalty for the non-compliers of the policies already announced. The penalty included five thousands US Dollars or imprisonment for six months or even both can be awarded to the culprits.
According to the policy announced by the board, buyers of HDB flats will not be able to hold other properties whether private or public. This equal treatment plan will be applicable hereafter. The announcement of penalty will help the board to enforce the cooling measures announced by the government.
The important part of the announcement is that the buyers of HDB flats will not only be allowed to own any private or public property inland but will have to certify that the property owned by them abroad is also disposed after the purchase of non-subsidized unit within the period announced by the board. However such buyers will be able to buy private lands after completion of the five years period. In that case they will be required to declare their intent for purchase of private property in the application.
After concerted efforts at the government level, the anti-speculation measures have finally started yielding positive results. According to the statistics released by Housing Development Board for the ending month of September a very sharp decline in resale of the HDB flats has been noticed. The market rose by 4% in the first two quarters of the year. However, during the third quarter initially market did not get effects of the cooling measures as the transactions for the real estate were ordered before Aug30. In the month of September market index dropped by 25% on resale of the HDB flats.
Market players who were observing the trends since the announcement of the anti-speculation measures have sighed of relief. Experts have even predicted that the market index will even go down by the end of the year 2010. It is expected that the market activity during forthcoming year will see more decline in the index due to government’s property cooling measures.
Experts are making opinion that during the next year the property cooling measures themselves are not going to reduce the property prices. Instead, these will only provide help in price reduction of the properties in Singapore.
Another reason for the decline in the market is that the buyers are not eager to invest at this moment as they want to be precisely clear of the new adjusted rates of the properties. On the other hand the sellers are also hesitant of selling their properties due to the market uncertainties.
HDB has announced availability of 3400 new flats by the end of this year, alongside 5000 units being made available during the first quarter of next year.
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