S’pore property shares plunge on cooling move

SINGAPORE: Shares of Singapore developers fell sharply after the
government took new steps to cool property prices with the toughest
measures aimed at foreign buyers who have become increasingly visible in
the residential sector.
Effective yesterday, buyers who are not
Singapore citizens or permanent residents will have to pay an additional
10% stamp duty when they buy a home, effectively raising the purchase
price by 10%.
Previous policy measures had targeted speculators
by imposing an extra duty on those who bought and sold properties within
four years and limiting the amount of loans available to prospective
buyers.
“It probably signals a change in policy. The government
had previously been very consistent in welcoming foreign investments, so
that is why the new policy came as a shock,” said Colin Tan, head of research and consultancy at Chesterton Suntec International.
Singapore
residential prices have held up well despite a slowing economy, helped
by low interest rates and rising demand from overseas investors, in
particular those from China.
The surprise an-nouncement on Wednesday night hit shares of property developers yesterday.
CapitaLand Ltd, South-East Asia's largest developer, fell as much as 8% to S$2.40, while No. 2 ranked City Developments Ltd dropped 7.3% to S$9.29.
Shares of Ho Bee Investment Ltd, which focuses on high-end condominiums, fell by as much as 12.1% to S$1.09. Reuters