The new property market cooling measures announced on Thursday are meant to stabilise home prices and not necessarily cause them to fall, National Development Minister Mah Bow Tan said yesterday.
The measures may not be the last as well, he warned, adding that the Government will monitor the market closely and may act again if needed.
But he emphasised that the measures are not permanent, and once they are no longer necessary, they will be removed.
He also recognised that the new sellers' stamp duty of up to 16 per cent could become a problem should property owners need to urgently sell their home shortly after they have bought it.
So if some owners had a mitigating reason to sell their home and could show it, such as for medical reasons, the Government was prepared to be flexible.
'You can't formulate a policy that satisfies everybody in a group,' said Mr Mah. 'What you can do is to have a general policy and where there are genuine cases, take them offline and consider appeals as and when they come in.'
The Government announced new rules on Thursday that raised the sellers' stamp duty on properties to as much as 16 per cent of the sale price if the home is offloaded within a year of purchase.
The amount banks can lend on a second mortgage has been lowered from 70 per cent to 60 per cent of the home's value.
Speaking on the sidelines of a bursary presentation ceremony in Tampines, Mr Mah said that while previous market cooling measures have had some effect, the Government felt it had to act pre-emptively in response to recent signs that the market had become buoyant again.
'There are signs that the economy is not going to be as strong as last year. Interest rates are not going to remain at these low levels forever,' he said.
'So for people who are looking at investment properties or those who are upgrading, the question is if this is the right time for them to buy. Are they able to afford the repayments when interest rates go up?'
He noted, however, that prices could still move up.
'Prices must move up if the economy is doing well and people have got good jobs - especially... where interest rates are at an all-time low and liquidity is at an all-time high.'
As for whether the Government will act again, Mr Mah said: 'We will wait and see how the prices react. The (time from the last round of measures) was about five months, and before that it was six... It really depends on how the market moves, there's no hard and fast timing.'
The cooling measures seemed to have done the trick in that regard. Showflats The Sunday Times visited yesterday were markedly quieter as agents reported a fall in buyer interest.
Potential buyers who did turn up said they were looking around, doing their sums and hoping that prices had been lowered.
Ms Jenny Yong, 29, a marketing executive who was at the Cascadia showflat in Bukit Timah yesterday, said: '(My fiance and I) are not planning to commit to a purchase any time soon as we think prices can move only one way now - down.'