By Shabnam Muzammil:
Despite the recent announcement of higher taxes for foreign property owners in Johor, interest among Singaporeans for real estate in the state will likely remain as prices there are significantly more attractive, The Business Times reported.
“It’s business as usual so far,” noted Steven Tan, Managing Director at OrangeTee, adding that none of the agency’s clients have requested to withdraw deposits on Johor properties.
Responding, Ku Swee Yong, CEO at International Property Advisor (IPA), said: “Unless it really comes as a very large increase, I don’t think people are deterred by it because your property tax is after all a very small component of your total cost of ownership, including your interest expenses.”
However, demand from Singaporean buyers might “moderate but not cool significantly”, noted Ong Kah Seng, Director at R’ST Research.
Ong added that impulsive investors could view the higher taxes as a “highlight that there is legislative framework and changes intrinsic in a foreign place”.
But experts noted that the real impact of the proposed changes depends on the full details which are yet to be disclosed and are expected to be introduced by the end of the year.
According to reports, 130,000 property owners could be affected by the tax hike, of which 90 percent are Singaporeans. Although rates for more affordable properties will remain the same, high-end units priced in the millions are likely to be affected.
Shabnam Muzammil, Senior Journalist at PropertyGuru, wrote this story. To contact her about this or other stories email shabnam@propertyguru.com.sg
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