Seller%E2%80%99S Stamp Duty Reset Timely Move Curb Speculation
The government has announced that the Seller’s Stamp Duty (SSD) holding period will revert back to four years from July 4, with a four-percentage point increase across all tiers. This move is in response to the rise in sub-sales since 2020, which are viewed as an indicator of speculative activity.
According to Ismail Gafoor, CEO of PropNex, the increase in sub-sales can be attributed to construction delays due to the Covid-19 pandemic and the sharp recovery in property prices, which have climbed by about 40% since 2020. He believes that some owners did not intend to flip their properties initially, but ended up doing so due to significant capital gains.
Leonard Tay, head of research at Knight Frank Singapore, explains that the delays in project completions caused by the pandemic have resulted in a rise in sub-sales. This is supported by the data from the Urban Redevelopment Authority (URA), which shows that the average quarterly sub-sale volume since 1Q2023 has been around 338 units, more than double the average of 131 units from 2013 to 2022.
In light of this, Tricia Song, CBRE’s head of research for Singapore and Southeast Asia, believes that the increase in SSD is a pre-emptive step to limit future speculative activity, especially as more developments near completion. She notes that private home completions are expected to rise from 5,920 units in 2025 to 6,838 units in 2026 and 10,306 units in 2027.
Despite the rise in sub-sales, Gafoor points out that the current volume remains below the levels recorded from 2007 to 2012. He views the latest SSD revision as a pre-emptive move to moderate short-term resales, particularly as the government plans to ramp up private housing supply across new neighbourhoods.
Market experts believe that most homeowners will not be significantly affected by the SSD increase as the majority of sellers hold their properties for at least five years. According to Marcus Chu, CEO of ERA Singapore, in 1H2025, 72.1% of homeowners sold their properties after holding them for five years or more.
However, there has been a notable increase in transactions involving properties held for three to four years, from 358 cases in 2021 to 2,104 cases in 2024. The majority of these sales were in the Outside Central Region (OCR), where entry prices are typically lower. Chu says that the spike in transactions in this segment can be attributed to factors such as elevated interest rates since late 2022 and property tax revisions in 2023, which have reduced investment yields.
The data also shows that the highest gross profits were made by those who held their properties for five years or more. This suggests that the latest SSD revision is targeted at short-term investors.
Analysts believe that the SSD increase is mainly a refined measure to moderate short-term investors. Mohan Sandrasegeran, head of research and data analytics at SRI, believes that the policy is a refinement, not a shock, as it reinforces discipline without destabilising genuine demand.
According to Lee Sze Teck, senior director of data analytics at Huttons Asia, SSD may not have a significant effect on market prices. A correlation test between sub-sale volumes and the URA price index from 2017 to 2Q2025 revealed a weak relationship of -0.045. Instead, a strong correlation of 0.727 was found between sub-sale volumes and the number of units launched three years prior. This suggests that sub-sales are more influenced by launch volumes than speculative intent.
Looking ahead, market experts expect the transaction activity to pick up in the coming months as there will be more new launches, a greater land supply under the Government Land Sales (GLS) programme, and declining interest rates, which improve affordability.
However, the Real Estate Developers’ Association of Singapore (REDAS) believes that the SSD revision will have a limited impact on genuine homebuyers, particularly Singaporeans and permanent residents, as transaction numbers have already shown signs of moderation. Hence, the impact on the market is expected to be minimal.
REDAS also expects that some investors may switch to commercial assets, such as strata offices and shophouses, which are not subject to SSD or Additional Buyer’s Stamp Duty (ABSD).
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