Joshua Tan Realty—Cooling measures have been a means implemented to manage the property market.
But have you ever wondered why so? And how do these cooling measures actually affect you?
Let's find out.
Cooling Measures Effect #1: Allows Creating a More Stable Market
Back in 1997 and 2008 when we had both the Asian and Global crises respectively, prices crashed & rebounded. In a V-shaped manner.
If you actually remember the chart, you'd find the pattern of this chart looking familiar.
However, things seemed to have change after the 2013 round of cooling measures, where the cooling measures effects kicked in, and where the market dipped & corrected in a U-shape manner this time round.
One of measures you might most often hear from 2013 onward is the Additional Buyers's Stamp Duty (ABSD).
But more importantly, till date (April 2023) the market looks more resilient than ever, "sustaining" prices even through the period of COVID-19.
Which is what we all want--for property prices to go up steadily and stably.
This is many a time attributed to the fact that speculators have been sieved out, which also means people with no holding power (funds to hold on to the property) are being filtered out of the market.
Cooling Measures Effect #2: Allows Protection From Recession
Now you might ask, why is this so?
And the reason is simple. If we once again look back at why cooling measures were implemented in the first place, it was to cool down & dampen the market demand.
As a result of the cooling measures effects, many property owners actually hold back their cash.
Property prices that could have been inflated, are so to speak not as inflated anymore.
Now, in times of recession, this allows the Singapore government some "leeway" to ease cooling measures, as required, and bring back the demand especially from foreign investors.
This in turn creates a relatively stronger market for Singapore and further supports your property prices.
I hope this article has enabled you to understand more about cooling measures.
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Disclaimer: While every reasonable cause is taken to ensure the accuracy of information provided or presented here, no responsibility can be accepted for any loss of inconvenience caused by any error or omission. The ideas, suggestions, general principles, examples and other information presented here are for reference and educational purposes only. This presentation is not in any way intended to provide investment advice or recommendations to buy, sell or lease properties or any form of property or financial investment. Joshua Tan Realty, Joshua Tan, its officers and successors shall have no liability for any loss or expense whatsoever, relating to investment decisions made by the audience. All copyrights reserved.
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