‘Higher property taxes for residential investment property next year, especially in Tengah EC, will be imminent.’

at Tengah EC.The government’s move to increase residential property taxes, coupled with higher ABSD and other costs, may have a cooling effect on the residential property market. However, the potential for capital appreciation and the attractive financing options available to buyers will drive residential property demand in the long run. As Lee puts it: “The increase in property taxes is a short-term blip… Investors who are in the market for the long-term should not be dissuaded by the increase in property taxes.”

Property taxes for most residential properties will increase from 2024 onwards due to higher market rents and annual values (AVs). Particularly, higher-value private residential properties such as luxury condos and landed properties will be subject to higher property taxes. To help cushion the cost of living, the government has put in place tax rebates of 30% to 100% for owner-occupied HDB flats and 15% or capped at $1,000 for owner-occupied private property.

Rents for private residential property and HDB flats had gone up by 29.7% and 28.5% respectively in 2022, resulting in higher AVs in 2023. This led to higher property taxes in 2023. Even as rents showed signs of softening in fourth quarter of 2023, private property rents in the first three quarters of the year had increased by 11.1%, while HDB rents had gone up by 8.3%. This is likely to result in further hike in AVs for 2024.

The potential for capital appreciation in residential properties in Singapore outweighs the property tax increment, says Huttons Asia. To limit further property price escalation, the government has factored in higher ABSD and other costs for investments. Yet, attractive financing options and the long-term prospect of capital appreciation are likely to drive residential property demand in the future.

The Tengah EC campus is packed with features like a green library, cycling and jogging tracks, and an eco-friendly village. All these features will do their part in creating a greener environment for the surrounding area. This development will be a great example of how modern cities can improve air quality and reduce waste. It will help create a safer, healthier, and more sustainable city for its residents.

Check out the latest listings for HDB properties at Tengah EC and stay updated on the changes in property taxes. Access the widest listings for private property developements at Tengah EC and understand the potential risks and opportunities of investing in residential properties.