Finance Minister Heng Swee Keat announced a slew of new measures last week to help Singaporeans and bolster the local economy, in the face of job cuts and a challenging economic outlook. We dissect the budget and list five ways it will affect you and your property.
By Khalil Adis
Office and industrial property sectors to benefit
The government has set aside a significant budget to support industries and innovation.
In total, $4.5 billion has been allocated under the Industry Transformation Programme.
This will lead to new industries and start-ups that could boost demand for office and industrial space.
Jurong West and Boon Lay poised for further growth
In line with this budget allocation, homeowners living in and near Jurong West and Boon Lay should hold on to their properties for the next six years.
The government will be developing the Jurong Innovation District (JID), located close to NTU, to support the growth of learning, research, innovation and production industries, with phase one expected to be ready in 2022.
JTC’s start-up arm, JTC Launchpad, will spearhead developments there, and is currently building Launchpad @ JID to serve as a space for entrepreneurs, researchers and students to spur innovation, similar to the one at one-north.
With the growth of the start-up industry in Jurong West, demand for homes and commercial spaces within the vicinity will increase.
We can expect property prices to appreciate by one to three percent on a conservative estimate, while the rental market is likely to get a boost from the spill-over impact of the various industries.
All these, together with the opening of the Tuas West MRT Extension in 2016 and the Jurong Lake District Master Plan, will augur well for the property market in Jurong West and Boon Lay.
More help for low-income families to own their homes
Sold your home previously and now living in a public rental flat? Families in such cases will not be able to get grants, as they would have received a housing subsidy before.
If you are thinking of buying a house but need some help, there’s good news. The government’s Fresh Start Housing Scheme will offer eligible families a housing grant of up to $35,000 to buy a 2-room HDB flat, but with a shorter lease.
However, there are conditions. You must be a family unit, demonstrate your ability to stay employed, and ensure your children attend school.
Rental market will continue to soften
Budget 2016 was focused on increasing productivity amongst locals and therefore, tightening the foreign labour workforce.
This will have a significant impact on sectors that are heavily reliant on foreign workers, such as retail, F&B and manufacturing.
As such, the already challenging rental market will continue to soften amid this new policy direction.
Be prepared to lower your asking prices, as landlords now outnumber rental seekers.
To move units quickly, do simple renovations, like adding a fresh coat of paint, ensuring everything works, and providing a washing machine and other modern conveniences.
Prospective tenants will appreciate your small gestures and this will put your property on top of their list.
Infrastructure spending and urban development will boost property values
Budget 2016 has allocated $5 billion for public infrastructure projects. This is about 7.3 percent higher than in the 2015 fiscal year.
The sectors that will benefit include healthcare, education, security and urban development.
The government announced that this year’s budget will see large expansion in public infrastructure and housing projects, despite the subdued property market.
No specific locations were mentioned, aside from the JID.
For those living in Jurong West and Boon Lay, this will certainly spell good news for their property values.