February has been a gruesome month for Singaporeans as the outbreak worsens and have had Singapore turned into the Yellow Zone. Amidst this, there is still good news for Singaporeans! On February 18, 2020, the budget has announce and brought forth a sense of relief for the real estate sectors.
The government has made effort for 2 sides of the real estate sector, the residential and commercial side, but we will only view from the commercial real estate side.
From our last article we mentioned on how the corona virus outbreak has impacted commercial real estate. In budget 2020, the government is now offering more to help them.
For starters, the GST hike has been postponed. With that said, there’s is still a probability that it may increase by 2% making it 9% in 2020.
Retail and F&B tenants who are already struggling can be rest assured by the postponing of GST. This helped the sectors to eventually translate to a lower risk of vacancies or late payments to the landlord.
In addition, there will be one month’s worth of rental waivers, with a minimum waiver of $200 for stallholders at hawker centre and markets managed by the National Environment Agency (NEA) said Deputy Prime Minister Heng Swee Keat.
From another look, anyone buying commercial property this year is also spared the two per cent hike. This is a good sign for investors who may want to sell off their commercial assets this year.
Despite global economy and the impact of the outbreak on office, retail and hospitality assets is making many buyers not keen to move into this space right now.
The government has also put in some effort for people renting commercial estate where they will receive half a month’s rental waiver by HDB to help offset the losses in this pandemic season.
There’s a 15 per cent property tax rebate that landlords are encouraged to pass on to tenants for establishment on private property.
Overall, this year’s budget boost the support for property sector directly and indirectly. Other schemes, ranging from help in re-skilling worker to Workfare Special Payment, don’t directly boost the property market. But in a broader sense, they do help to raise confidence in buying a home, or paying the mortgage.
How Will Budget 2020 Impact Singapore’s Real Estate Market?
20 February, 2020