📋 Tender Overview
The real estate market is one of the major pillars of the economy, closely linked to the financial - banking system and social security. When house prices exceed peoples ability to pay, the result is an imbalance in supply and demand, increasing financial risks, reducing market confidence and directly affecting social security. A social housing project in Singapore In the context of rising house prices in many countries, especially in large cities, governments have applied a series of selective intervention measures to control speculation, support middle- and low-income people in accessing housing, and ensure sustainable market development. Singapore: Controlling speculation, ensuring home ownership Singapore is one of the most successful countries in Asia in regulating real estate prices. thanks to the close and synchronous intervention between tax - credit - public housing policies. Specifically, this country applies additional registration tax to real estate buyers at high levels to limit multiple home ownership: 20% for a second home, 30% for a third home or more and up to 60% for foreigners. Singapore applies strict limits on debt capacity: Total debt payments relative to income must not exceed 55% of monthly income; Maximum loan-to-asset value ratio is 75% for the first apartment, 45% for the second apartment and 35% for the third apartment or more. Thanks to that, buyers must carefully consider their financial capacity to avoid risks of bad debt and credit bubbles. Singapore also strongly develops its public housing system. The public housing development policy managed by the Housing Development Board (HDB) is a successful example in regulating housing prices. More than 80% of the population owns houses from the HDB system with selling and rent prices suitable for income. The Singapore government proactively allocates land funds for social housing, and directly supports first-time buyers through subsidies and long-term credit with preferential interest rates. Thanks to the synchronous combination of tax, credit and social housing tools, house prices in Singapore are controlled stably, while maintaining access to housing for the majority of people. Korea: Tightening credit, applying progressive taxes, controlling price ceilings Korea is one of the countries with a system of regulatory system Tight real estate market with financial tools, taxes and price management implemented synchronously. First, tighten real estate credit: The government limits the loan-to-asset value ratio to a maximum of 40% in Seoul and the debt repayment ratio to income is about 40%. Second, progressive taxation on multiple home ownership: Korea applies a transaction tax of 8% for the second home, 12% for the third home or more; At the same time, implement a comprehensive real estate ownership tax for those who own many houses or high-value houses, with progressive tax rates from 0.6% to 6%/year. Third, control the selling price of new apartments: The Government regulates the ceiling price for apartments in projects using public land or under the public housing program. In price control areas, investors must have the selling price approved by the management agency, which must not exceed the ceiling price to avoid price inflation. Fourth, transparent transaction management: All real estate sale and transfer contracts must be publicly declared. The government closely monitors to prevent understatement of prices to avoid taxes or inflated transactions to create bubbles. Fifth, developing public housing and low-cost rental housing: Through the Bogeumjari Housing program, the government provides affordable housing for middle-income people, developed by state-owned companies such as Korea Land & Housing Corporation, with selling prices calculated based on cost plus limited profit margin. The State also encourages the private sector to participate in social housing construction with tax incentives, land and loans, and strictly controls beneficiaries to prevent policy profiteering. The above measures help reduce short-term speculation, cool the market in some hot spots, and redirect investment in the apartment market to commercial real estate and financial products. However, Korea still faces limited supply in Seoul. Many households do not speculate but still suffer high taxes due to inheritance; The period 2022-2023 recorded a record low number of transactions in 10 years. China: Controlling speculation and tightening credit through the three red lines China is a country that applies many strong measures to cool down the real estate market, with a focus on controlling transactions, tightening credit and managing corporate debt. Firstly, restricting transactions and speculation: In big cities, each household can only buy a maximum of 1-2 apartments. home. People from outside the province who want to buy must prove that they have paid taxes or social insurance locally for 2-5 consecutive years. Businesses are prohibited from buying houses for speculation, and newly purchased commercial housing must be kept for 2-5 years before being resold. Second, tighten credit and control capital flows into real estate: The government limits the loan-to-asset value ratio at 30-60%, the interest rate for a second or third home loan is higher than the interest rate for a first home (in Beijing about 3.05% for a first home, 3.45% for a second home). In particular, China Apply the three giRed limits to monitor the financial health of real estate businesses: Ratio of liabilities/total assets (after deducting advances) <= 70%; net debt/equity ratio <= 100%; short-term cash/short-term debt ratio >= 1. The more criteria a business violates, the tighter the new loan limit will be. Third, regulate with taxes and transaction fees: Main taxes including registration tax: 1-5%; land use tax; real estate tax on pilot non-residential commercial real estate in some major cities (in Shanghai: 0.4%-0.6%, in Chongqing: 0.5%-1.2%); Second home transact
