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Investing in a condo in Singapore is rapidly gaining popularity among both local and foreign investors. The city-state’s strong economy, stable political climate, and excellent quality of life make it an attractive choice. With numerous opportunities available in Singapore’s real estate market, condos are a standout option due to their convenience, amenities, and potential for high returns. In fact, with the recent new condo launches, the demand for condos in Singapore is only increasing. In this article, we will discuss the advantages of investing in a condo in Singapore, important considerations to keep in mind, and the necessary steps to take.
The Singapore government recently announced a one-off property tax rebate for owner-occupied homes in 2025. This includes a 20% rebate for HDB flats and a 15% rebate for private residential properties. However, the rebate for private homeowners will be capped at $1,000.
Property tax is calculated based on a property’s annual value, which is the estimated rent a property can generate in a year if it were to be rented out. The government has decided to raise all annual value bands of owner-occupier’s residential property tax rates on January 1, 2024 as part of Budget 2024.
This move will result in lower property taxes for over 90% of owner-occupied properties, supporting the government’s efforts to ease the cost of living for Singaporeans. According to Lee Sze Teck, senior director of data analytics at Huttons Asia, the annual value of private properties is likely to remain flat due to minimal growth in private residential rents this year. However, HDB rents are expected to increase by 4%, leading to a slight increase in the annual value of HDB flats.
The one-off property tax rebate aims to help HDB owners cushion any impact from the increase in annual value. For instance, a HDB flat with an annual value of $30,000 will have a property tax payable of $720 in 2025. With the rebate, the owner will only need to pay $576, resulting in savings of $144.
Private residential owners may also benefit from the one-off rebate. For example, a property with an annual value of $85,000 will have a property tax payable of $5,760. With the 15% rebate, capped at $1,000, the owner will only pay $4,896, saving $864.
While property tax rebates have been offered before, they do not reduce the appeal of investing in residential properties in Singapore. The potential for capital appreciation far outweighs the increase in property tax, making residential properties a attractive investment option.