Singapore doubles stamp duty for foreign buyers
1 minute to read
What happened?
On 26 April 2023, the Additional Buyers Stamp Duty (ABSD) payable by non-residents in Singapore increased from 30% to 60%.
When adding the ABSD to Singapore’s Buyers Stamp Duty (BSD), a non-resident now pays S$3 million (US$2.242 million) in ABSD and S$239,600 (US$179,092) in BSD when purchasing a S$5 million (US$3.737 million) property.
By comparison, permanent residents in Singapore will pay 5% ABSD for their primary residence, 30% ABSD for their second property and 35% for their third or subsequent property.
Entities or trusts purchasing any residential property will now pay 65%, up from 35%.
It is worth noting the higher ABSD costs do not apply to purchasers from the US, Switzerland, Iceland, Norway and Liechtenstein where separate trade agreements exist with Singapore.
Why did the Singapore government act?
Since the lifting of travel bans post-Covid Singapore has seen buyers from overseas increase, particularly demand from Chinese mainland increase. The move is aimed at stemming the tide of cross-border capital which is inflating residential prices.
According to the Urban Development Authority in Singapore house prices increased 11% in the year to March 2023, up from 6.9% a year earlier.
What impact will the move have?
Non-resident purchases account for around 5% of buyers in Singapore meaning the impact on sales volumes and prices is likely to be limited.
The move sends a message, however, that the government is willing to step in when there are concerns about housing affordability.
How do purchase costs for non-residents compare across key global markets?
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