{"id":8174,"date":"2016-12-20T15:57:26","date_gmt":"2016-12-20T07:57:26","guid":{"rendered":"https:\/\/www.99.co\/blog\/singapore\/?p=8174"},"modified":"2023-08-04T17:45:42","modified_gmt":"2023-08-04T09:45:42","slug":"condo-buying-absd-deadline","status":"publish","type":"post","link":"https:\/\/www.99.co\/singapore\/insider\/condo-buying-absd-deadline\/","title":{"rendered":"Is it the right time to buy a condo near its ABSD deadline in 2017?"},"content":{"rendered":"
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With the ABSD deadline approaching, is it a worthwhile time to be on the lookout for deep discounts?<\/figcaption><\/figure>\n

The Additional Buyers\u2019 Stamp Duty (ABSD) for developers is nearing its deadline. In light of the hefty penalties, some buyers presume that we will see further price discounts as the months draw on. Developers, however, seem to be holding firm.<\/span><\/p>\n

What is the ABSD for developers?<\/b><\/h3>\n

The ABSD imposes an additional tax on developers, if they cannot complete and sell out all units in a development within five years. The penalty is 15 percent of the land price (10 percent for sites purchased before 12<\/span>th<\/span> January 2013), plus 5 percent interest per annum. This penalty applies if even one unit is left unsold.<\/span><\/p>\n

The ABSD for developers was instituted in December 2011, as a way to discourage developers from artificially raising demand by withholding land and units.<\/span><\/p>\n

Will the ABSD result in discounts?<\/b><\/h3>\n

Some developments nearing the ABSD, such as <\/span>Trilinq<\/span><\/a>, have seen discounts of around 10 percent. However, we have to point out that developers give discounts for many reasons, not just the ABSD. With prices having declined consecutively for 12 quarters, and the property market being sluggish, developers may be giving these discounts regardless of the ABSD.<\/span><\/p>\n

In addition, some \u201cdiscounts\u201d are really just promotional efforts. For example, a developer could inflate the price by 10 percent, and then give out 10 percent discounts shortly after a launch.<\/span><\/p>\n

In short, we cannot accurately identify which discounts are the <\/span>direct <\/span><\/i>result of ABSD deadlines, and which discounts are a part of regular promotional efforts in a slow market. <\/span><\/p>\n

Some developers may also choose to set up companies to buy their own units. This will allow them to hold on to the units and sell them at a later, more profitable time; we cannot count on <\/span>every <\/span><\/i>developer panicking and rushing to sell. <\/span><\/p>\n

However, we can make some <\/b>calculated guesses<\/i><\/b> of where ABSD could be a big motivator of discounts<\/b><\/p>\n

Some developments where ABSD are likely to drive discounts include:<\/span><\/p>\n