Skip to main content

Property stamp duties increase for foreigners is more anti-inflationary than anti-speculation

This is one of the occasion I support a Government's move.


The increase in property stamp fees is a good preventive against a possible influx of money overseas which will result in high inflation.

For new Singapore buyers, this is good news for them. For sellers, not that good. For the Real Estate Developers Association of Singapore, they were very disappointed with this increase stamp duties


Wrote Channel NewsAsia,

REDAS said the good take-up rate in the primary market is driven by the increased number of new launches and unique selling points of certain projects.
It is not indicative of a return to a speculative market.
REDAS believes given that the local economy is expected to slow down next year, the measures are untimely.
REDAS must be suffering from short term memory lost. In the crisis of 2007 -2008, we saw the prices of property shoot up even when the Singapore slowed down.

The flux of today's economic problem is that there is too much money chasing for limited supply of goods which therefore drive prices up. REDAS, this is called inflation.

Money is being printed in the US and European countries like nobody business to pay off the interest  for their sovereign debts alone.

Once the "investors" are paid off, they would need to invest their money somewhere and somehow. The bond market in Europe, which used to be considered safe, is a high risk market which they are looking to get out of. Interest rates are so low that they end up paying banks to keep their money.

So where is this flux of money going? If you have read the economic blogs, these flux of money is sitting in the shadow banking world of derivatives, buying and selling of contracts of commodities that has yet to bore fruit. That is why prices for basic commodities, like rice, sugar, floor, has been increasing.

But once the derivatives market becomes unprofitable, where would the money go? It is forecast that this supply of money is expected to be released next year. And they will most likely head towards the property market.

So even if the Singapore economy slows down next year, prices of property will still shoot up because there is just too much money sitting out there.

Of course REDAS is disappointed as this increase in property stamp duties means it would be harder to sell their buildings or properties.

A foreign buyer would have to think twice, no thrice, about buying a property. He/she must have the confidence that the property price here will increase by 20%-30% in five years time or more for him/her to sell and make money from this "investment".

Not highly possible with Singapore Government under voting pressure to make housing more affordable to Singaporeans.

Comments

Popular posts from this blog

Why is Ramly Burger banned in Singapore?

Yahoo Singapore ran an article of the Ramly Burger by highlighting that it is ban in Singapore.

Yet, the writer from Makansutra failed to address the most important issue of why the Ramly meat patty is banned in Singapore.

A search online easily did highlight that the famous Malaysian meat patty is banned by the AVA but didn't go into details.

Wrote Arlina Arshad for The Straits Times in January 2004,

"But the importing of beef and beef products from Malaysia is not permitted, said theAgri-Food and Veterinary Authority (AVA).

Selling and supplying them without a permit is also an offence, and offenders can befined as much as $50,000 or jailed two years, or both, said the AVA."

In May of the same year, another article highlighted that a man was even charged in court for "smuggling" the Ramly burger in 2004.


"The AVA said that meat products processed in Malaysian food factories which it had notapproved were banned here.Suzali was yesterday jailed for four month…

Muthu The Firefighter Isabelle in 3.412 minutes

You can call her Muthu the firefighter if you bump in today’s featured blogger Isabelle at the popular night club.Social PR chats with Isabelle to find out why she likes cows so much.Who are you? Ie what is your blog name and your real name. Why did you come up with the blog title?I am Isabelle.But you might also know me by my more provincial sounding Chinese name "Xiaoyun". Or "Muthu the firefighter" if you bump into me in clubs when I am high or not thinking staight.My blog "Isabelle Neo" is named after me and "weecloud" is just a word play on my chinese name.What are you? In ten (or so) words, you would describe your blog as: …I am a dreamer and an escapist with a quirky take on life. I blog about topics that interests me, in particular food, fashion, beauty, entertainment and travel. In addition, you also get to view the daily humdrums of (my) life through my eyes.  Editorial Deadline? Ie when should PRs NOT call?I was a public relations exe…

Will mrbrown's post on Mr Tan Kin Lian's thermometer app "misadventure" promote technology ageism?

I am not ashamed to say I support Mr Tan Kin Lian as a presidential candidate because I believed in what he stood for.

And when Mr Tan posted his "misadventure" with a thermometer app, I did shake my head in disbelief that he did that.

Thinking twice, there could be a possibility that Mr Tan misunderstood how this app work. Most  thermometer app take data from various weather stations to display the temperature on it.

Yes, the technology savvy will do a #facepalm when they read the post and mrbrown's post demonstrated it perfectly.

Wrote mrbrown,

"Maybe the former Presidential-hopeful didn't realize he needed to upgrade to the Pro version of the app. Then his iPhone would not only measure temperature, it would also measure current PSI (PM2.5 included), tell you if you are having your period, and cook instant noodles.

Good thing he didn't try to measure boiling water."

Unfortunately, because of mrbrown's influence, the younger generation might fear tea…