A Look at the Singapore Property Situation
Singapore is reputed for its many millionaires who make it have at least a million USD investable assets. It is important to note that this does not include Singapore property. The real estate business in Singapore has kind of undergone a new launch since 2011. If you remember, in 2009 the industry faced some problems that led to drop in prices but this has since picked up. The rise has gone up to 38% which is a new record in history after 1996 rates. This has actually led to the common scene of private apartments being put on sale at a rate of a million USD on any Singapore new launch.
You could be wondering, what has sparked this Singapore property market to be this lucrative? Well, part of the reason could be due to the credit access that is easily available, low interest rates as well as the growing economy of Singapore. The economy is reported to have experienced a growth of up to 18% during the second quarter of 2012 alone. Other reasons could be due to the increasing number of immigrants entering Singapore.
Other interesting fact about Singapore is that home buyers spend only 36% of their monthly earnings on their housing loans. In 1997, when Singapore real estate was thought to be at its peak, the rate was 50%. This means that Singapore property is affordable. Singapore also has support from its government. For instance, the government has declared a 3% tax on all re-sales within the first 36 months of purchase. They have also announced a 30% minimum deposit on the second home. They have also declared an improved schedule for land release for second half of 2012.
That is not about all that the Singapore government is doing to support Singapore new launch. The government has also loosened some of the housing policies and this has led to the affordability of flats in the Design Build and Sell Scheme for most citizens. The targets here are citizens who earn between 8,000 and 10,000 USD. In effect, the demand for private homes will come down because then it would be possible for everyone to afford public property. As for developers of real estate, they may also put new launch on hold and focus on preview sales.
No doubt, the support the Singapore government has given to Singapore property is impressive. It has made real estate a promising industry in Singapore and of course it has the promise of high returns and a security against inflation. The government is promising more support even in future.
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