It is no surprise that Singapore tops among 189 countries in ease of doing business as per the report prepared by World Bank for the year 2015. Singapore is considered as one of the most expensive property markets in the world. The pace of the growth shows quite similar trends as seen during pre-economic-crisis period in the crisis ravaged countries. While some of the western property markets like London have witnesses only a little more than the double growth, the Singapore property prices have gone up by around 232%. The government of the country is trying to keep a check on the price levels at home. But, what are possible reasons behind this? Are foreign nationals considering it as an investment opportunity to park their money abroad? Is the interest rate too low to woo the buyers? Let’s find out!
Low capital gains tax attracts foreign nationals to invest in the properties
High capital gains tax can be pretty repealing for foreigners. Contrary to that, Singapore charges low capital gains tax. This attracts the foreign investors more than anything. The tax paid by the individuals from the foreign countries is one fourth of the investment made in the properties. This is the maximum as per the country’s tax rules.
US Federal Reserve has not hiked the interest rates
When US Federal Reserve hikes the interest rates, it impacts all the economies in the world. The Fed hasn’t increased the interest rates this time also citing the reasons as providing more opportunities for the insiders. This has further increased the demand for properties in the country unlike before.
The value of Singapore dollar has remained strong constantly
Price fluctuations can prove to be devastating for the buyers of the properties. It will be hard for them to speculate about the price in the long run. The value of Singapore dollar has remained stable for long. This has furthered the wish of the individuals to stick to their goal of buying properties as they have planned beforehand.
Subsidized mortgage as provided by the government works as an incentive for the property buyers
Most of the people, around 80 percent of the people in Singapore live in the social houses. This gives them a quality option as compared to other options and other high-end cities in the world. Working population of the country contribute around 20 percent of their salary in the national provident fund. They can use the provident fund money to subside their mortgage for buying properties.
Stable political conditions give security and attract people to the city
It is true that rich people especially highly rich people can buy properties in any countries. But after paying lump sum amount of money if you don’t get enough security there is no use of the money that you are paying. Regarding this aspect, Singapore is considered as one of the highly secured countries in the world.
Laws that give further freedom to investors
As per the laws of the Singapore, anybody can acquire non-land properties in the country which are free from holdings. This makes easy for the buyers to invest in the properties. This proves regulation as the main factor which woos the buyers and makes the Singapore property hot.