New cooling measures not likely anytime soon

The government is unlikely to impose new cooling measures in the immediate term, taking into consideration the current economic conditions and the effectiveness of the previous policies, according to Png Poh Soon, Head of Research at Knight Frank Singapore.

His comments come after the Urban Redevelopment Authority (URA) released its flash estimates for Q3 2012 which shows that private home prices increased 0.5 percent on a quarterly basis, the highest rate of increase this year.

“The government would have to monitor and calibrate any new measures carefully in the context of weakening economic outlook,” noted Png.

He added that the last few rounds of cooling measures, including the ABSD (additional buyer’s stamp duty) have been successful in curbing overseas buying interest, reflected in the lower number of foreign buyers across all residential segments.

“Speculators have also been kept out of the market and investors hold properties for a longer period, as indicated by the lower sub-sale transaction volumes.”

Meanwhile, there are fresh concerns that the US government’s third round of quantitative easing (QE3) is likely to drive a fresh wave of overseas capital into Singapore’s property market.

However, Png feels that foreign demand is expected to be well-capped by the ABSD, which imposes higher transaction costs on non-Singaporean home buyers.

Source : PropertyGuru – 2 Oct 2012

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