Hot stocks: Property plays in the red on new housing cooling measures

SINGAPORE’S property stocks lost some ground on Thursday (Dec 16), after the government announced new measures to cool the hot housing market the night before (Dec 15).

Property developers City Developments Limited (CDL) and UOL, which are both Straits Times Index (STI) constituents, fell into negative territory at the market open but recovered slightly by the end of the trading session.

CDL hit a low of S$6.78 as at 9.20 am on Thursday, losing 4.1 per cent or S$0.29. The counter later closed 2.7 per cent or S$0.19 lower at S$6.88 on the day, with 5.8 million shares changing hands. 

UOL reached a low S$6.89 right when the market opened, sliding 3 per cent or S$0.21. It later closed 0.9 per cent or S$0.06 lower at S$7.04, with 1.5 million shares changing hands. 

Real estate agencies PropNex and APAC Realty also dived within the first half an hour of trading.

PropNex fell as much as 14 per cent minutes after the market opened, dropping S$0.25 to a low of S$1.53, before closing 3.9 per cent or S$0.07 lower at S$1.71. 

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APAC Realty dropped as much as 15 per cent or S$0.115 to hit a low of S$0.65 at 9.01 am. The counter later closed 10.5 per cent or S$0.08 lower at S$0.685. 

Other property counters also ended Thursday in the red. Frasers Property slid 0.9 per cent or S$0.01 to close at S$1.14, GuocoLand was down 0.7 per cent or S$0.01 to S$1.51, while Oxley Holdings closed 2.1 per cent or S$0.004 lower at S$0.183.

Singapore’s government said it will raise additional buyer's stamp duty (ABSD) rates and tighten the total debt servicing ratio (TDSR) threshold from Thursday onwards. 

The current ABSD rates for Singapore citizens and permanent residents buying their first residential property will remain unchanged, but those buying their second residential property will have ABSD rates raised to 17 per cent and 25 per cent respectively.

Meanwhile, the ABSD rates for all other individuals and entities will be raised by 5 to 15 percentage points.

The TDSR threshold will be tightened to 55 per cent, from 60 per cent, and will apply to property purchase loans where the option to purchase is granted on or after Dec 16, and for mortgage equity withdrawal loan applications made on or after Dec 16. (see amendment note)

READ MORE:

• Singapore announces new property cooling measures

• Singapore property developers will face 'immense' pressure from higher ABSD: Redas

• Investors, foreigners, en bloc hopefuls to bear brunt of new property cooling measures

• Government to increase BTO, GLS programme supply together with cooling measures

• Quick takes: How might fresh cooling measures affect Singapore's property market?

Amendment note: The story has been amended to reflect the correct revised TSDR threshold.