SINGAPORE, Jan 11: Singapore on Friday made it costlier for foreigners to buy property and imposed other measures to cool down the market in which home prices have continued to rise despite an economic slowdown.

Starting on Saturday, foreign buyers have to pay total stamp duties of 18 per cent of a property’s valuation, up from 13 per cent, a government press release said. Foreigners with permanent residency in Singapore will have to pay eight percent stamp duties, up from three per cent.

Singaporeans will still enjoy the normal three per cent stamp duty for their first purchases, but will have to pay more for additional properties. “We have to take this further round of measures now, to check recent market trends and avoid a more serious correction in prices further down the road,” Finance Minister Tharman Shanmugaratnam said.

In addition to higher stamp duties, the minimum cash down payments for individuals applying for loans for second or subsequent homes will be raised from 10 per cent to 25 per cent. Singapore has imposed several rounds of property-cooling measures but demand has remained robust. In October, the central bank imposed a maximum tenure of 35 years for new housing loans.

The press statement said the buoyant property market “reflects the very low interest rate environment and continued income growth in Singapore”. The new property measures came after Singapore narrowly avoided a technical recession in 2012 thanks to growth in the services sector in the fourth quarter.

The economy grew just 1.2 per cent in 2012, from 4.9 per cent in 2011, with 2013 expansion forecast at 1.0-3.0 per cent. The city-state has been hit by lower demand from key markets like the US and Europe for its exports, particularly electronics. —AFP