Property taxes will rise in 2023. There will be an upward revision to the annual value for the majority of residential properties. The value of a property’s annual worth that is used to calculate property tax owed from the property owner is determined as by the Inland Revenue Authority of Singapore (IRAS) as the estimated gross annual rental of the property as if the property is being rented out.
The Lakegarden Residences launch date sits in a desirable location in the Jurong neighbourhood. It’s a perfect location away from the fast-paced city life and allows homeowners to live in Singapore’s next.
A press release issued on December 2 issued by the Ministry of Finance (MOF) and IRAS states that the annual valuations for the majority of residential properties which include privately owned property as well as HDB flats which will be updated starting January 1st 2023. It is as part IRAS’s annual review, and it reflects the rising market rents. “Since the last update of annual values on January 1, 2022, the market rents for HDB flats as well as privately owned residential properties have increased more than 20%,” the release says.
In the same announcement, MOF and IRAS announced the possibility of a one-time property tax credit for 2023, which is up to 60 dollars for homeowner-occupied homes. The rebate will be equivalent of 60% from the 2023 property tax bill, and will be offset automatically in the event of a property tax due in 2023.
To be able to afford HDB flats, owners who own two-room and one-room flats will not be required to pay property tax in 2023 if their updated annual values are less than $8,000. Nicholas Mak, head of research and consulting for ERA Singapore, says that of the 1.033 million currently occupied HDB apartments owned by single owners Onetwo-room flats comprise around 4% of them, meaning most HDB apartment owners are going to be affected by the more hefty property tax rate in 2023 and beyond.
He believes that the property tax hike for owners of HDB homes are “manageable” for the majority of flat owners. He says the property tax for the most expensive flats (executive flats) will rise by a range of $55.20 and $67.20 from 2023.
Additionally, Tricia Song, CBRE’s director of research for Southeast Asia, says that the higher values for the year follow the increase of property tax rates announced in February in the Budget 2022 announcement. The tax increase, which is expected to occur in two stages beginning in 2023, will most likely affect more expensive properties that have annual values of more than $60,000. “With this rise in tax rates and the value of annual properties this will further shave off the rental gains made so far for non-occupier or investor homeowner,” she says.
Non-owner-occupied residential properties that include investments properties, property tax rates will increase by 10% -20% in the present time, rising up to 11% and 27% in 2023 then 12% until 36% for 2024. For residential properties that are owned by the owner properties in the meantime, property taxes will rise by four% up to 16% at present, and then increasing to% up to 33% in 2023, to 5%–>% in 2023 and then 6% until 32% for 2024. The increase is only applicable to the part of the annual value that is greater than $30,000.
In light of the new property tax rates and taking into account the 20% rise in the annual value CBRE’s Song estimates that properties that have annual values in the range of $30,000. (prior an upward adjustment of the annual value) will be able to see property taxes rise by $1,260 which is 42% in 2023. For properties that have an annual value in the range of $60,000 property tax bills are projected to rise by $5,190 equivalent to 75.2% in 2023. For properties that have an annual value of $90,000. property taxes are projected to increase by $9,810 , or 81.8% in 2023.
The ERA’s Mak believes that landlords renewing leases on rental properties may be taking the chance to raise rents, however, Mak warns against any overt increases. “Many renters are suffering due to rising rents in the last 1.5 months.”