An Overview of Budget 2023: How Will The Property Market Be Affected
On 14 Feb 2023, DPM and Finance Minister Lawrence Wong delivered the 2023 Budget Statement in Parliament. He outlined plans to strengthen our social compact and enable Singaporeans to tackle upcoming challenges, as well as to seize new opportunities to prepare for the future.
On the property front, here’s how Budget 2023 may affect you:
- Higher balloting chances for first-timers applying BTO
- Increased housing grants for resale flat buyers
- Increased housing grants for first-timer singles
- Revised stamp duty rates for private properties
Flat buyers both new and resale may rejoice after the announcement of Budget 2023 as added balloting chances for a select group of home buyers and higher CPF grants may alleviate some stress off this group of people. On the other hand, private property buyers are faced with higher taxes.
Higher Balloting Chances for First-Timers Applying BTO
Married couples aged 40 and under, as well as families with children will receive an additional balloting chance when applying for a BTO flat from the government, up from the initial two chances for first-time applicants.
While word on the ground has it that older first-time applicants and those with no intentions of starting a family yet are at a disadvantage, it may be fair to argue that those with children or are expecting, need a home to call their own more urgently.
The extra ballot chance will be ‘among other measures’ taken to help these two groups (families already with children, and married couples aged 40 and below) get their keys faster. Full details will kick in later this year, after the Parliamentary debates that determine MND’s budget.
Increased Housing Grants for Resale Flat Buyers
The revised grant is available for those who submit their resale applications on or after 1st April 2023. For those who have yet to complete their resale transaction by 3.30pm on 14th February or who submit their application between now and 31st March, the difference between the current and revised grant will be disbursed to you within 3 months of completing the resale transaction. Do note that eligibility requirements for the grant still applies. You may check on the requirements at HDB’s website here.
Increased Housing Grants for First-Timer Singles
Revised Stamp Duty Rates for Private Properties
The increased Buyer’s Stamp Duty (BSD) will impact property values above $1.5 million. This portion of the property value (above $1.5 million and up to $3 million) will be taxed at 5% — up from the current 4%
Lower BSD rates still apply if :
- OTP was granted on or before 14/02/2023
- OTP is exercised on or before 07/03/2023
- OTP is not varied on or after 15/02/2023
Smaller units under $1.5 million are not affected by the revised stamp duty rates. However, HDB upgraders commonly look for larger units which often comes with a price tag above $1.5 million. Nonetheless, this marginal increase is unlikely to dissuade buyers looking to purchase for own-stay.
Non-residential properties are also affected by this revised rate. The value in excess of $1 millions and up to $1.5million will be taxed at 4%, while any amount is excess of $1.5million is taxed at 5% — up the from previous rate of 3%
For most HDB home buyers, this year’s budget announcement is a small win to them. The overall impact on the private market from the higher BSD is not as drastic as a cooling measure and can be seen as a measure to contain the property market. With inflation already creeping up on most of us, the scaling-up of grants also aids in the affordability of purchasing a home.
I hope this article serves purposeful in helping you make a more well-informed decision, regardless of whether you’re purchasing a property for own-stay or investment. As always, feel free to share your opinion in the comment section and I will take time to address them when I can. Till next time!