Since the implementation of higher Additional Buyer’s Stamp Duty (ABSD) rates in Singapore, the methodology to assess property ownership and investment has undergone significant change. During the 1990s, Singaporean real estate investors skillfully navigated the market by leveraging rental income from one property to fund the purchase of another. How things have changed over the years.

In practice, the ABSD has become a substantial barrier that necessitates even the most discerning investors to reevaluate their strategies. The key takeaway from this brief tutorial is how to buy 2nd property in Singapore without ABSD.

Depending on your nationality, you might or might not be eligible for ABSD remission under free trade agreements. When they buy residential properties in SINGAPORE, nationals or permanent residents of countries such as the United States, Norway, Iceland, Liechtenstein, and Iceland pay the same Residential ABSD rates as Singaporeans.

The principle of “National Treatment,” established under the Singapore-European Free Trade Agreement (EFTA), serves as the fundamental basis for this privilege. In accordance with the relevant free trade agreements, individuals who are citizens or permanent residents of these countries are eligible for ABSD remission.

Individuals are allowed to buy a second commercial property in Singapore without paying Additional Buyer’s Stamp Duty (ABSD). ABSD rates do not apply to commercial properties. Due to their exemption from additional stamp duties, they constitute an attractive option for investors seeking to expand their property portfolios without incurring supplementary costs.

Compared to the typical 2% to 3% range observed in the residential sector, commercial properties generally offer higher rental yields, averaging approximately 5%. Property in commercial investments offers financial benefits due to the potential for future development.

It is crucial to gain a comprehensive understanding of the distinctive characteristics and inherent hazards of commercial properties. Compared to residential properties, commercial properties require a larger cash outlay to purchase.

To add to the complexity, commercial properties require the full down payment to be paid in cash, whereas residential properties may allow the use of CPF. GST, currently 8%, is, without a doubt, applicable to commercial properties. It is always required to remit the GST amount in cash.

Investing in commercial property can yield significant returns; however, it requires meticulous research and a thorough understanding of Singapore’s commercial real estate market, which differs considerably from the residential sector.