Tuesday, 10 June 2014

How GST Will Impact Home Prices & The Property Market

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GST, government service tax, goods and service tax, standard rated gst, zero rated gst, exempt rated gst, GST on property price, property price GST, residential properties gst, commercial properties gst

The example above shows a price increase of 3.41% for new residential properties post-GST implementation. But there is a plus point to this.

Overall, new residential properties may register a lower overall increase in tax burden compared to Commercial Properties that are Standard-Rated. This is because there still is the chance that developers may only transfer some and not all of their tax cost increases into the final retail price.

The downside to this is that where pricing for new commercial properties will be cleaner (Sales Price + GST), pricing for new residential homes would look inflated. This, in turn, will undoubtedly have a knock on effect on prices in the secondary house market.


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