Today (18 February 2022), Finance Minister Lawrence Wong made the Budget 2022 announcement. This time, there are a few property-related announcements to take note of, the biggest one being an increase in property taxes for residential properties.
In case you missed it, here’s a quick summary.
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Budget 2022 Announcement |
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Increase in property tax for non-owner-occupied residential properties |
From 12% to 36% (Previously 10% to 20%) |
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Increase in property tax for owner-occupied residential properties (the portion exceeding $30,000 annual value only) |
From 6% to 32% (Previously 4% to 16%) |
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Fresh Start Housing Scheme to be enhanced |
Details TBA |
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Plans for more EV charging points near homes |
Details TBA |
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Household Support Package |
Doubled GST vouchers and U-Save rebates, additional $200 for Singaporeans under age 21, additional $100 CDC vouchers for all Singaporean households |
Budget 2022: Higher Property Taxes for Residential Properties
It was announced that property tax rates for non-owner-occupied residential properties will be raised to 12% to 36%, depending on the annual value of the property. Currently (until the new rates are effective), the tax levied on such properties is 10 to 20%.
Coming so soon after Additional Buyer’s Stamp Duties (ABSD) were increased in the latest round of property cooling measures (16 December 2021), this is another blow to investors owning multiple properties.
For owner-occupied residential properties, the property tax rates will also be increased to 6% to 32% for the annual value portion that exceeds $30,000.
With all the chatter on an impending wealth tax, this is unsurprising.
“The increase in property tax rates clearly target the wealthier demographic, as it gets progressively more expensive as the annual value of the homes increase. The average Singaporean homeowner who owns just the one humble property they live in is unaffected by this. However, those who own luxury homes and/or multiple properties will definitely feel the pinch,” Dr Tan Tee Khoon, Country Manager, PropertyGuru Singapore.
Budget 2022: Enhanced Fresh Start Housing Scheme
The Fresh Start Housing Scheme caters to second-timer families with young children who are living in public rental flats. Through the scheme, they receive assistance towards owning their own 2-room Flexi flat.
Key features of the current Fresh Start Housing Scheme:
- Can buy short-lease 2-room Flexi Flats from BTO or SBF exercises
- Short leases vary from 45 to 65 years, but must cover all owners can spouse-occupiers until age 95
- 20-year Minimum Occupation Period applies
- Can take up HDB housing loan, subject to credit assessment
- Resale Levy capped at $30,000 (may be adjusted depending on lease)
- Fresh Start Housing Grant of $35,000
- $20,000 lump sum disburse into eligible applicants’ CPF OA over five years
- Priority allocation in HDB sales exercises under Tenants’ Priority Scheme
You can find out more about the eligibility conditions on HDB.
Although it was announced that the Fresh Start Housing Scheme will be further enhanced as part of Budget 2022, the exact improvements have not been released. More details will be shared in about a week, during the parliamentary debate.
Budget 2022: More EV Charging Points Near Homes
A key pillar of the Budget 2022 is sustainability. In line with that and as part of the Singapore Green Plan, the Government has set aside more resources to phase out internal combustion engine vehicles by 2040 and encourage electric vehicle (EV) adoption.
The specific details are not known yet, but the Government intends to build more EV charging points near homes. This will definitely be useful for the growing population of eco-conscious homeowners. According to Mr Wong, new EV car registrations have increased from 0.2% in 2020 to 4% in 2021.
Related article: Electric Cars in Singapore: 8 HDB Towns That Will Be EV-Ready By 2025
Budget 2022: New Household Support Package; GST Vouchers and U-Save Rebates for Eligible Households
Ah, we’ve saved your favourite for the last. The most anticipated part of every Budget speech is the GST voucher and U-Save rebate announcement.
If you don’t already know about the schemes, read our guide here: GST Voucher and U-Save Rebates: How Much Can You Get?
As part of the new Household Support Package, eligible households will receive double the GST vouchers and U-Save rebates for the rest of 2022. Those with children under age 21 may receive another $200 top-up to their Child Development Account, Edusave Account or Post-Secondary Education Account. Another $100 in Community Development Council (CDC) vouchers will also be given to all Singaporean households.
Additionally, to cushion the impact of higher carbon taxes announced, the Government will also be offering extra U-Save rebates (to be announced next year, 2023).
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This article was written by Eugenia Liew, Content Marketing Manager, PropertyGuru Singapore. Eugenia has gone through the BTO rite of passage and continues navigating the property market, hoping to one day own a private property with a yard for her dogs to play in. Share your thoughts on this article or tell her more about what you want to read at eugenialiew@propertyguru.com.sg.
