With the property market setting new records each month, government revenues from stamp duty look set to reach new highs this year.
Property deals in the first five months of this year have yielded more than $1.7 billion in stamp duty. At this rate, the government coffers could get a $4 billion boost for the entire year.
The takings for the first five months of this year have already surpassed the $1.3 billion for all of last year, the latest official statistics showed.
And this is just 7.7 per cent shy of the record $1.8 billion in 1996, the last property market peak.
But with the pace of transactions hotting up over the past few months, some analysts are predicting that the stamp duty collected could rise even more.
‘If the property market continues as it is now - and we are only starting to see it pick up - we are looking at somewhere in the order of
$4 billion to $5 billion in stamp duty,’ said Mr Song Seng Wun, economist and research head at stockbroking house CIMB-GK.
Stamp duty is a tax on commercial and legal documents used in certain transactions. The bulk of it comes from property purchases. Stamp duty ranges from 1 per cent to 3 per cent of the purchase price.
The latest surge in stamp duty is largely due to the jump in property prices and transactions. ‘Stamp duty reflects increased economic activities everywhere, but the main contributor has certainly been the property market,’ said Mr Song.
Mr Nicholas Mak, director of research and consultancy at property firm Knight Frank, also sees a surge in stamp duty, though he is slightly less bullish than Mr Song.
He expects a record 33,000 private homes to be sold this year. The average value of each home is also likely to be higher than in the past, he noted.
This would increase stamp duty, as it is calculated as a percentage of a property’s price. Based on this, he projects tax takings of about $3.2 billion.
A recent tweak in stamp duty rules may also contribute to the boost. In December, the Government stopped deferring stamp duty payments on property sales - a practice started in 1998 that allowed buyers to put off paying it for up to a few years.
Now, property buyers have to cough up stamp duty within 14 days of agreeing to buy. But those who bought properties before December still enjoy deferments.
This means that the stamp duty takings so far this year come not only from new property sales in the first five months, but also from deferred sales in past years, bumping up the figure.
Economists say stamp duty is set to become the third biggest contributor to government operating revenue this year, from being one of the smallest in the past.
It is projected to surpass customs and excise duties, motor vehicle taxes, property taxes and betting taxes. Since 2000, it has consistently fallen behind all four categories.
Analysts also noted that with the bumper take from stamp duty, as well as projected higher takings from the goods and services tax and income tax, government revenues are likely to surpass the $32 billion collected last year.
Source: The Straits Times, 16 July 2007
Monday, July 16, 2007
United States-based luxury property agent Sotheby’s International Realty has set up a franchise in Singapore, attracted by the growing stream
United States-based luxury property agent Sotheby’s International Realty has set up a franchise in Singapore, attracted by the growing stream of foreign buyers seeking a home in the red-hot property market.
The high-end property broker offers services to help its rich global clientele find a dream home here. Clients are invited to preview sought-after properties, even before they are soft- launched.
Sotheby’s has just started in Singapore but is already handling more than 20 deals and expects to be busy.
Developers have lapped up a record amount of prime collective sale sites, so there should be no lack of new and exciting posh projects.
Property consultancy Savills Singapore announced last week that it had formed a business unit to work with private banks in advising the banks’ growing number of high net worth individuals.
Even PropNex, a property agent that started out in the HDB market - and is still strong in that segment - has jumped onto the bandwagon. PropNex Grandeur Homes was set up in March, headed by Mr Douglas Wong, who was previously associate director of Knight Frank’s Regal Homes, which deals with good class bungalows (GCBs).
Mr David Wong, chief executive of the Sotheby’s franchise in Singapore, said a typical day could involve picking a client up from the airport and driving him to the latest developments to help him select a unit or two.
The tour is complete with expert advice and could end with lunch at a top-end restaurant.
Sotheby’s clients get chauffeured around in a car they like. ‘We have a fleet of cars, including a Bentley, at our disposal,’ said Mr Wong.
Its clients have previewed Scotts Square, Wheelock Properties’ luxury condominium in Scotts Road, and the posh 8 Napier on the former Eng Lok Mansion site. Neither project has been launched. Sales at Scotts Square have not even started, though indicative prices hover around an average of $4,500 per sq ft (psf).
As for 8 Napier, developer Napier Properties, controlled in part by former Parkway Holdings boss Tony Tan, has released just 10 out of 46 units for sale at between $4,000 psf and $4,500 psf.
Sotheby’s clients were the first group to view the homes over a week ago. They have also seen other posh projects - mostly in districts 9, 10 and 11, including GCBs.
Mr Wong said the high-end properties they help clients - either wealthy individuals or institutional investors - find are typically priced from $3,500 psf. To him, luxury properties are those priced from $5,000 psf.
Sotheby’s International Realty is owned by the world’s leading franchisor of real estate brokerages, US-based Realogy. The brand is offered via an exclusive 25-year master franchise. It was recently secured by JVC Capital, a firm controlled by investors including seasoned property investor, Dr Goh Seng Heng.
Prior to joining Sotheby’s, Mr Wong, 42, spent nearly four years as director of sales and marketing for SC Global Developments, which specialises in building luxury homes. Before that, he headed the Prestige Homes division of Savills Singapore.
He said his firm can also help developer clients package their products to appeal to ’sophisticated international buyers’.
‘You basically create a product that can command a certain price,’ he said.
Sotheby’s will even conduct auctions in cases where a need arises, such as when there is strong demand for a project, Mr Wong said. Those auctions will be conducted by a Sotheby’s auctioneer from New York, he added.
So far, the real estate arm of British-based Christie’s has helped raise the upmarket appeal of some properties, the first of which were the Sentosa Cove land parcels.
The exclusive affiliate of Christie’s Great Estates, Mr Ken Jacobs, has conducted auctions jointly with Colliers International in Singapore and could continue to do so, depending on the available luxury projects in Singapore.
For now, Mr Wong said his firm is focusing on helping its global network of clients buy homes here, although in future, it will look into assisting Singaporeans in buying homes worldwide.
Source: The Straits Times, 16 July 2007
The high-end property broker offers services to help its rich global clientele find a dream home here. Clients are invited to preview sought-after properties, even before they are soft- launched.
Sotheby’s has just started in Singapore but is already handling more than 20 deals and expects to be busy.
Developers have lapped up a record amount of prime collective sale sites, so there should be no lack of new and exciting posh projects.
Property consultancy Savills Singapore announced last week that it had formed a business unit to work with private banks in advising the banks’ growing number of high net worth individuals.
Even PropNex, a property agent that started out in the HDB market - and is still strong in that segment - has jumped onto the bandwagon. PropNex Grandeur Homes was set up in March, headed by Mr Douglas Wong, who was previously associate director of Knight Frank’s Regal Homes, which deals with good class bungalows (GCBs).
Mr David Wong, chief executive of the Sotheby’s franchise in Singapore, said a typical day could involve picking a client up from the airport and driving him to the latest developments to help him select a unit or two.
The tour is complete with expert advice and could end with lunch at a top-end restaurant.
Sotheby’s clients get chauffeured around in a car they like. ‘We have a fleet of cars, including a Bentley, at our disposal,’ said Mr Wong.
Its clients have previewed Scotts Square, Wheelock Properties’ luxury condominium in Scotts Road, and the posh 8 Napier on the former Eng Lok Mansion site. Neither project has been launched. Sales at Scotts Square have not even started, though indicative prices hover around an average of $4,500 per sq ft (psf).
As for 8 Napier, developer Napier Properties, controlled in part by former Parkway Holdings boss Tony Tan, has released just 10 out of 46 units for sale at between $4,000 psf and $4,500 psf.
Sotheby’s clients were the first group to view the homes over a week ago. They have also seen other posh projects - mostly in districts 9, 10 and 11, including GCBs.
Mr Wong said the high-end properties they help clients - either wealthy individuals or institutional investors - find are typically priced from $3,500 psf. To him, luxury properties are those priced from $5,000 psf.
Sotheby’s International Realty is owned by the world’s leading franchisor of real estate brokerages, US-based Realogy. The brand is offered via an exclusive 25-year master franchise. It was recently secured by JVC Capital, a firm controlled by investors including seasoned property investor, Dr Goh Seng Heng.
Prior to joining Sotheby’s, Mr Wong, 42, spent nearly four years as director of sales and marketing for SC Global Developments, which specialises in building luxury homes. Before that, he headed the Prestige Homes division of Savills Singapore.
He said his firm can also help developer clients package their products to appeal to ’sophisticated international buyers’.
‘You basically create a product that can command a certain price,’ he said.
Sotheby’s will even conduct auctions in cases where a need arises, such as when there is strong demand for a project, Mr Wong said. Those auctions will be conducted by a Sotheby’s auctioneer from New York, he added.
So far, the real estate arm of British-based Christie’s has helped raise the upmarket appeal of some properties, the first of which were the Sentosa Cove land parcels.
The exclusive affiliate of Christie’s Great Estates, Mr Ken Jacobs, has conducted auctions jointly with Colliers International in Singapore and could continue to do so, depending on the available luxury projects in Singapore.
For now, Mr Wong said his firm is focusing on helping its global network of clients buy homes here, although in future, it will look into assisting Singaporeans in buying homes worldwide.
Source: The Straits Times, 16 July 2007
Six months after Indonesia abruptly banned the export of land sand to Singapore, the construction industry appears to have come to grips
Six months after Indonesia abruptly banned the export of land sand to Singapore, the construction industry appears to have come to grips with the disruption caused.
Prices for sand, which shot up initially, have stabilised, and an agreement has been reached by key industry players on how to share the cost increases.
The Construction Industry Joint Committee (CIJC) - which represents eight industry associations - has worked out a 75-25 per cent formula for private projects.
Under the agreement, developers will bear 75 per cent of the cost, with the other 25 per cent to be shared between contractors and concrete suppliers, according to a note sent out by the committee.
This is similar to the government’s position of paying 75 per cent of the increase in construction costs of public sector projects affected by the ban.
CIJC chairman Chang Meng Teng said the formula is not a legal requirement but a recommended guideline that industry players should follow.
Most developers and contractors have already worked out arrangements on a case-by-case basis, said Mr Chia Hock Jin, executive director of the Real Estate Developers Association of Singapore.
In February, Indonesia’s sand ban also caused a disruption in granite supply when its navy detained several Singapore-bound barges carrying granite on suspicion of sand smuggling.
The prices of sand and granite rocketed as a result of shortages in supply, pushing up concrete prices from $70 to $200 per cu m. Sand and granite is used to make concrete, which is used heavily for construction here.
Contractors - especially those with private contracts - faced losses of millions of dollars as they had to absorb the price increases to continue with their projects.
Since then, prices of sand, granite and concrete have dropped as suppliers diversify their sources to neighbouring countries such as Malaysia, Vietnam and Cambodia.
The recent note from the CIJC follows lengthy negotiations between the developers, contractors and suppliers, and comes after a period of uncertainty over who should bear the costs.
Mr Desmond Hill, president of the Singapore Contractors Association, said he was delighted with the agreement, noting that it ’sets some ground rules’ for future negotiations.
Meanwhile, the surest sign the construction industry is back on its feet came last week when it recorded growth of 17.9 per cent in the second quarter - the fastest pace in 10 years - according to preliminary figures from the Ministry of Trade and Industry.
But industry players noted that the surge in demand for construction materials and equipment is pushing overall costs up.
Source: The Straits Times, 16 July 2007
Prices for sand, which shot up initially, have stabilised, and an agreement has been reached by key industry players on how to share the cost increases.
The Construction Industry Joint Committee (CIJC) - which represents eight industry associations - has worked out a 75-25 per cent formula for private projects.
Under the agreement, developers will bear 75 per cent of the cost, with the other 25 per cent to be shared between contractors and concrete suppliers, according to a note sent out by the committee.
This is similar to the government’s position of paying 75 per cent of the increase in construction costs of public sector projects affected by the ban.
CIJC chairman Chang Meng Teng said the formula is not a legal requirement but a recommended guideline that industry players should follow.
Most developers and contractors have already worked out arrangements on a case-by-case basis, said Mr Chia Hock Jin, executive director of the Real Estate Developers Association of Singapore.
In February, Indonesia’s sand ban also caused a disruption in granite supply when its navy detained several Singapore-bound barges carrying granite on suspicion of sand smuggling.
The prices of sand and granite rocketed as a result of shortages in supply, pushing up concrete prices from $70 to $200 per cu m. Sand and granite is used to make concrete, which is used heavily for construction here.
Contractors - especially those with private contracts - faced losses of millions of dollars as they had to absorb the price increases to continue with their projects.
Since then, prices of sand, granite and concrete have dropped as suppliers diversify their sources to neighbouring countries such as Malaysia, Vietnam and Cambodia.
The recent note from the CIJC follows lengthy negotiations between the developers, contractors and suppliers, and comes after a period of uncertainty over who should bear the costs.
Mr Desmond Hill, president of the Singapore Contractors Association, said he was delighted with the agreement, noting that it ’sets some ground rules’ for future negotiations.
Meanwhile, the surest sign the construction industry is back on its feet came last week when it recorded growth of 17.9 per cent in the second quarter - the fastest pace in 10 years - according to preliminary figures from the Ministry of Trade and Industry.
But industry players noted that the surge in demand for construction materials and equipment is pushing overall costs up.
Source: The Straits Times, 16 July 2007
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