Several bulk residential sales were recorded in Q1 2017 as some foreign developers tried to offload their remaining unsold units to avoid paying hefty penalties.
Singapore saw sales of investment properties, or big-ticket property transactions of at least $10 million, drop 38.5 percent to $5.2 billion in Q1 2017, reported the Business Times.
Property consultancy Savills stated that commercial property investment sales accounted for $2.8 billion of the total sales, while industrial properties contributed $344.2 million. The residential sector, on the other hand, made up $2.1 billion.
This comes as a flurry of bulk residential sales were recorded in the first quarter of 2017 as some foreign developers tried to offload their remaining unsold units ahead of the Qualifying Certificate (QC) deadline to avoid paying hefty penalties.
Developers also secured a slew of last-minute deals on 10 March, including The Lumos, TwentyOne Angullia Park, Robin Residences and The Line @ Tanjong Rhu, to avoid the new additional conveyance duties (ACD), which took effect the next day.
The ACD plugged a tax loophole that allowed some bulk buyers of residential projects in Singapore to enjoy significant savings in stamp duties.
With the new rule, Steven Ming, Managing Director at Savills Singapore, believes institutions will unlikely “return to the bulk residential sales market as the hefty 18 percent stamp duty cuts deep into their required rates of return”.
Nonetheless, Desmond Sim, Head of Research, Singapore and South East Asia at CBRE, sees a bright spot in the collective sales market.
“We should see more interest in en bloc sales from land-hungry developers, especially in the face of limited supply through the Government Land Sales Programme.”