During the first half of 2021, approximately 3,500 luxury homes were sold
According to EdgeProp, In 2021, prime residential prices in Singapore increased by a modest 3.5 percent. The moderate growth in prime home prices in Singapore can be attributed to government efforts aimed at taming price inflation.
Leonard Tay, head of research at Knight Frank Singapore, said “The Singapore government announced recent cooling measures in December 2021 to temper the beginnings of a house-hunting boom that happened amid a pandemic. More recently, they have also announced the increase in property taxes that are targeted at higher-end assets which might potentially rein in some property investors’ interest.”
Good class bungalows are mansions or villas that can date back to colonial times and are at least 15,000 sq ft (1,400 sq m). These sit in Singapore’s most luxurious districts.
Ultra-high net worth individuals (UNHWIs) usually own these types of properties as they are more tech-savvy and are looking for flexible homes that focus on energy efficiency and connectivity, both digital and physical, shared Business Times.
Those who own good class bungalows may feel the pinch from the upcoming increase in property tax. The only exception would be if their property commands an annual value of SGD30,000 (USD 22,000) or less.
Tricia Song, head of research for Southeast Asia at CBRE Singapore said that the tax hike is more like a wealth tax targeting the top end of the marketing.
Dr. Tan Tee Khoon, country manager for PropertyGuru Singapore added that luxury homes will not be affected by the tax hike because these concentrate more on capital appreciation rather than rental yield. “Demand for luxury residential properties has been resilient, largely driven by both local and foreign property buyers. Furthermore, the focus on capital preservation throughout the pandemic has driven many foreign investors to divert their funds to real estate properties,” he added.
CNA reported that during the first half of 2021, approximately 3,500 luxury homes were sold, surpassing the annual sales from 2018 to 2020.
The Property Report editors wrote this article. For more information, email: [email protected].
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