PropNex chief calls for ABSD revision, reversion of LTV limits

By
/ EdgeProp
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March 14, 2019 4:34 PM SGT
PropNex Realty has submitted three recommendations to the Ministry of Finance and the Ministry of National Development to revise last July’s property cooling measures, CEO Ismail Gafoor announced in a press briefing today. They are: a remission of additional buyer’s stamp duty (ABSD) for HDB upgraders, a reversion of loan-to-value (LTV) limits for first housing loans, and a revision of the ABSD rate for locals buying a second property.
PropNex Realty CEO Ismail Gafoor announced the recommendations in a press briefing on March 14 (Picture: Samuel Isaac Chua/EdgeProp Singapore)
One reason for the recommendations, which Gafoor says the company began preparing in January this year, was the reported spike in the number of returned units in new launches since November last year. That was when most developers decided to launch their developments after taking stock of the latest round of property cooling measures implemented in July last year, says Gafoor.
Another reason was the 16.8% y-o-y drop in new home sales in 2018. Developers sold a total of 8,795 private new homes (excluding executive condos or ECs) last year compared to 10,566 in 2017.
“A multitude of underlying factors such as declining new mortgage loan applications, increasing pipeline supply of private residential units, a lack of ECs on the market and rising number of HDB flats that are reaching the minimum occupation period (MOP) are timely reminders that are prompting for a reasonable cause of action to be taken,” the company says in a press release.
The first recommendation suggests treating “genuine HDB upgraders who are purchasing their first private residential property, in a similar capacity as those who are acquiring an EC, through the allowance of remissions”. These buyers should be allowed to undertake to HDB to agree to dispose of their existing HDB flat within six months from the time of completion for resale properties or upon Temporary Occupation Permit (TOP) date for newly launched properties. To safeguard...