April 3, 2024
Forty-four residential projects, or 12% of projects with a sale deadline within 2021 to 2023, were granted more time to clear all unsold units, on top of the extensions provided under Covid-19 temporary relief measures, Deputy Prime Minister Lawrence Wong said in his written parliamentary response on April 2. DPM Wong disclosed that the appeals by developers of the 44 projects were approved “as they involved extenuating circumstances, such as the developer facing site-specific delays that were unforeseen and beyond its control.”
Under current rules, housing developers pay an additional buyer’s stamp duty (ABSD) of 40% on land they acquire for residential development, but can obtain a remission of 35% if they sell all the units in the development within five years of their buying the land.
With effect from Feb 16, projects with at least 90% of units sold at the five-year sale timeline will be subject to a lower ABSD remission clawback rate.
According to the Inland Revenue Authority of Singapore (Iras), the revisions announced in Budget 2024, are not applicable to housing development projects with residential land acquired before July 6, 2018, which are subject to a 15% ABSD rate. For land acquired between July 2018 and December 2021, the ABSD payable is 25%, with a non-remissable component of 5%.
In 2020, a six-month extension was given to developers to meet the conditions for ABSD remissions. It was among a slew of temporary relief measures rolled out in May 2020 to tide developers and home buyers over the circuit-breaker lockdown, which disrupted construction timelines and property sales.
Most analysts were of the view that the 44 projects may not have much impact on total unsold inventory levels.
Cuscaden Reserve is one of the projects which has its sales deadline extended to 2024. Since its sales relaunch on March 16, Cuscaden Reserve has sold 80 units so far at an average price of slightly more than $3,000 psf. Before that, it had sold just 12 units at an average price of $3,600 psf since its launch in September 2019.