3 Key Amendments Affecting the Property Market

DPM Lawrence Wong in his budget speech in Parliament announced 3 key amendments that will have an impact in the real estate market.  They are:

• Increase in Buyers’ Stamp Duty (BSD) rates
• Increase in CPF Grants for first-timer families and singles purchasing resale HDB Flats
• Increase in the Ordinary Wage Ceiling for CPF Contributions

The increase in BSD is seen as a “luxury tax” for purchases above $1.5m.  For property purchased at between $1.5m and $3m, a rate of 5% of the purchase price will be levied.  Properties priced att above $3m, a stamp duty rate of 6% will be levied.  All real property contracts are subjected to stamp duties.

To help Singapore Citizens afford their first homes, DPM Wong announced that the CPF Grant for First-timer families wll be increased by $30,000 from $50,000 to $80,000 for first-timer families purchasing a 4-room or smaller HDB resale flat.  The Grants is increased from $40,000 to $50,000 for purchases of 5-room or larger resale flats.  Eligible singles who are Singaporeans will qualify for half the grants.

DPM Wong also announced that the Ordinary Wage (OW) Ceiling for CPF Contributions will be raised from $6,000 per month to $8,000 by 2026.  The change will take place gradually starting from 1 Sept 2023.  The Employee Contribution rate of 20% nd Emplyer of 17% remains unchanged.  This is to help Singapore save more for retirement.