Image by Jason Goh from Pixabay

En-bloc market to collapse following ABSD rate hike: analyst

Singapore increased the ABSD for all residential statuses by 3% to 30%.

The steep hike in the Additional Buyer's Stamp Duty (ABSD) will likely hurt the en-bloc market, which has already been slowing down before the implementation of the latest cooling measure, according to Vijay Natarajan, an analyst from RHB.

In a report, Natarajan said the en-bloc market will likely “collapse” and “come to a standstill” due to pricing expectation mismatch.

Apart from the en-bloc market, RHB expects the hike to impact land prices. 

“We believe the biggest impact from the measures will be on land purchases, with developers likely to turn more cautious with their bids in light of recent measures, increased land supply, and weakening macro conditions. In our view, this could pave the way for sustained lower property prices in the future and moderate the overall property market,” Natarajan said.

Other segments that will likely feel the hike's impact are the resale market and high-end segment, which Natarajan said will see a price correction.

“Post measures, we expect further divergence in pricing expectations between buyers and sellers in the resale market. This should initially result in a slowdown in transaction volumes and eventually result in price corrections,” the analyst said.

“We believe sellers are more likely to adjust their prices lower amid sharply rising holding costs and a slowing labour market. Similarly, the high-end luxury market will also be impacted as foreign buyers typically account for a significantly high proportion (20-40%) in this segment,” the expert added.

Follow the link for more news on

Join Singapore Business Review community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!