Foreign Homes, Same Rules

[neubie 2]

PEOPLE who own a home overseas will still have to comply with the tough new rules on property ownership if they want to buy a HDB resale flat.

The clarification on Wednesday came amid uncertainty over who might or might not be exempt from the rules announced on Monday. The new regulations state that if you buy a HDB resale flat you must dispose of any additional private property within six months of the HDB purchase.

That rule also applies to people who own homes offshore, according to the HDB on Wednesday. This means an overseas property must be sold within six months of buying a HDB resale flat. And an owner of a non-subsidised HDB flat who has yet to meet his minimum occupation period of (MOP) of five years will also not be allowed to buy a private property locally or abroad.

How new financing rules affect owners of homes offshore was also made clearer on Wednesday. Under the revised regulations, a buyer with a mortgage on a local property must stump up a downpayment of 30 per cent when buying an additional property. This is up from 20 per cent previously.

And at least 10 per cent of this deposit must be in cash - up from 5 per cent before - with the rest coming from his Central Provident Fund (CPF) accounts.

But the Monetary Authority of Singapore (MAS) said that a buyer with a home loan for an overseas property will not be subject to these financing rules if buying an additional property here. However, the MAS said it 'expect(s) financial institutions to take into account the borrower's outstanding loans when making their credit assessment'.

question is how they know?

[Ely 0]

Yes, I'm wondering that, because that is the reason which prohibits me from getting any grant. Now, even when I sell, I still get no grant because there is a 30month cooling off period. You can simply not declare it, but then you face the risk of a $10k fine and 6 months jail term (fraud). So not taking the risk

I have a question:

What if I simply CANNOT find a buyer within 6 months? Not that I don't want to but am completely unable to? What happens??

[neubie 2]

got pple complain liao....

HDB flat dilemma for PRs and Singaporeans with property abroad

PERMANENT resident (PR) Michael Lim is keen to upgrade to a larger HDB flat but the new rules on dual property ownership have put him in a pickle.

Mr Lim's problem is that he also owns a condominium in Kuala Lumpur that he inherited when his father died. Previously, this would not have hindered his purchase of a resale flat. But now it will.

The HDB announced on Monday that people who buy an HDB resale flat on or after Aug 30 must dispose of their private property - including any held overseas - within six months of the HDB purchase.

The intention is to ensure that HDB flats go to owner occupiers first and are not viewed as an investment. This means Mr Lim, who has been living in Singapore for 10 years, must sell the condo in Kuala Lumpur if he wants to upgrade from a four-room to a five-room HDB flat to fit his family of four.

But his mother-in-law is living in the condo and he has no plans to sell it.

Mr Lim, 33, hopes the HDB will make an exception in his case, given that he did not buy the condo as an investment.

'Malaysia is also our home and it's weird if we go back and do not have a place to stay... It's not fair to make me choose when I have ties to both countries.'

Ms Bhavani Prakash, 40, a PR from India who has a home in Chennai, said the new rules will also deter her from buying an HDB flat.

'The measures are quite draconian. Whether someone owns a property overseas really does not have an impact on the Singapore market... There are other ways to counter speculation,' she said.

There are many other PRs who could find themselves in a similar dilemma.

Experts say a significant number of PRs still have homes in their native countries since overseas properties are often cheaper than real estate here and are not as great a financial burden. A number of them may also have families back home living in those properties.

Ms Prakash's Chennai condo cost her between $200,000 and $300,000 - a quarter of the cost of a suburban condo in Singapore.

ECG Property chief executive Eric Cheng estimates that 40 per cent of PRs - especially those from Malaysia - own homes abroad, while PropNex chief executive Mohamed Ismail puts the figure at up to 30 per cent.

ERA Asia Pacific associate director Eugene Lim believes that more than half of the PRs arriving over the past few years would still have properties back home.

The curbs could also catch out Singaporean retirees with property offshore that they had bought for rental income or retirement. With strong family ties and business connections here, they might also be looking at buying HDB flats for their frequent visits here.

Now, if they want to buy a resale HDB flat, they will have to dispose their overseas real estate or risk penalties by trying to dodge the new rules.

Despite the tougher measures aimed at cooling the property market, a 99-year luxury project, Dorsett Residences, above Outram MRT Station was sold out in one day when it was launched at an average price of $1,800 per sq ft yesterday. But The Straits Times understands that 40 per cent of the 68-unit project was bought by a single buyer.

[bepgof 20]

Yes, I'm wondering that, because that is the reason which prohibits me from getting any grant. Now, even when I sell, I still get no grant because there is a 30month cooling off period. You can simply not declare it, but then you face the risk of a $10k fine and 6 months jail term (fraud). So not taking the risk

I have a question:

What if I simply CANNOT find a buyer within 6 months? Not that I don't want to but am completely unable to? What happens??

Another cheaper way: change name.

Edited September 3, 2010 by bepgof

[Ely 0]

Who can I transfer it to? No one else in my family are PRs.

[liewsc 0]

Transfer the oversea property to family member lo, i think is less than RM7K for legal fee and stamp duty. But Msia land office will take super long time for the transfer, usually 1 to 2 years to do the job. That will..... emmm still violate the 6 months rules

[Ely 0]

Transfer the oversea property to family member lo, i think is less than RM7K for legal fee and stamp duty. But Msia land office will take super long time for the transfer, usually 1 to 2 years to do the job. That will..... emmm still violate the 6 months rules

I can't transfer it to a family member as non of them are Permanent Residents, and Australia has a law that foreigners are unable to own an "old" property (any property that has been bought before), it needs to be brand new or in the developing stage. So, am going to sell the house and family will purchase another new property. Will simply store everything from current property into storage and move it into new place when we find one. Just so tedious...