Singapore sales heat up after government eases cooling measures

Sales of Singapore property are heating up this spring, after the government has eased some of its cooling measures.

Home sales surged by more than 300 per cent this February compared to a year ago, according to new figures from the Urban Redevelopment Authority. Tranactions soared form 303 in February 2016 to 977 in February 2017, up from 382 in January and the highest level recorded in a February for five years.

Developers offered 550 units last month, up from 108 in January, as they raced to meet the pent-up demand for real estate.

The jump in activity occurs just after the goverment has rolled back cooling measures introduced to curb activity and price growth. The city has seen prices fall for 13 quarters in a row since the measures were first rolled out in 2009, and strengthened in 2013, with values declining 3 per cent last year.

“Singapore’s property market had been quite weak for a period, this is more reactionary for the Singaporean government to prop up the market,” James Soutter, a portfolio manager at K2 Asset Management in Melbourne, told Bloomberg when the announcement was first made.

The eased restrictions will see sellers’ stamp duty, currently payable on properties sold within four years, shortened to three years, with the rate also reduced to 4 per cent on homes sold in that third year and to a maximum of 12 per cent for homes sold within one year.

Developers’ shares soared on the back of the decision, with research from JLL suggesting that the positive sentiment is spreading throughout the market.

“Our outlook for the Singapore property market in the coming years is a positive one,” Regina Lim, National Director of Advisory and Research at JLL Singapore, told the SCMP.

“Transactions of luxury residential units doubled in 2016 and prices for this segment have risen mildly. Buyers see Singapore’s luxury residential properties as compelling given the competitive pricing. We expect transaction volume and prices to continue to recover from 2017 to 2020.”

On, Singapore jumped up the popularity chart in February, with the city entering the Top 10 most sought-after countries in the world for the first time.