To curb speculation after house prices soared to a record high, Singapore recently tightened regulations on the property market.
These cooling measures include raising the down payment for second mortgages, imposing a seller's stamp duty on homes sold within three years of purchase, and extending the minimum period that owners must hold a property to avoid sales tax. Furthermore, homeowners with more than one mortgage can only borrow up to 60% of a property's value, down from 70%.
Singapore's fastest economic growth since 1965 has resulted in private home price climbing 2.7% in the fourth quarter of 2010. It was the smallest increase in six quarters, but in November private home sales rose the highest in seven months. "Buoyant sentiments", as an analyst puts it, will mean more house price gains. The Monetary Authority of Singapore also says that low borrowing costs and increased international liquidity may raise house prices further. However, with the cooling measures in place, the gains are expected to reach 5%, and not an earlier forecast of 12%.