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Singapore hikes stamp duty, cuts loan limits amid housing sector's recovery

Singapore's government is raising the additional buyer's stamp duty, or ABSD, rates and tightening the loan-to-value limits in the city state after seeing signs of a price recovery in the private residential property sector.

Under the new rules taking effect July 6, ABSD for individual buyers will be increased by 5 percentage points, while rates for entities will have a 10-percentage-point top-up. The loan-to-value limits, on the other hand, will be tightened by 5 percentage points for all housing loans extended by financial institutions.

Developers purchasing residential properties for housing projects will be subject to the rate hike for entities and will also have to pay an additional non-remittable 5% of ABSD under the country's remission rules. Individual foreign investors, meanwhile, are subject to paying ABSD rates of 20% under the revision, marking an increase from a previous 15% level.

Because of the cut on loan-to-value limits, the mortgage equity withdrawal loans have also been adjusted to 75% for a borrower with no outstanding housing loan and to 45% for borrowers with outstanding housing loans.