No Relaxing of Singapore Property Curbs Soon
Head of central bank, MD Ravi Menon, said that the Singapore Property Market will not have its curbs eased anytime soon.
The mortgage refinancing rule has been eased last week by the Monetary Authority of Singapore (MAS). It took effect on 1 Sep 2016. This is not to increase demand for new home loans but rather to help alleviate current homeowners’ loan burdens. The rule does not apply to new home loans so essentially it is not to create new demand for housing loans.
The Total Debt Servicing Ratio (TDSR) framework was introduced into the Singapore property market in 2013 to moderate the prices of the red-hot real estate market. TDSR curbs borrowing by property buyers to 60% of their monthly income. With effect from 1 Sep 2016, homeowners looking to refinance their existing mortgages will not need to adhere to the 60% cap on their TDSR even if they had observed it when they bought their apartment.
Housing curbs have been implemented since 2009 to help ease home prices with some of the strictest rules being introduced in 2013 such as the Additional Buyer Stamp Duty (ABSD) and the TDSR framework on residential property buys.
The government’s stand is that real estate curbs will not be relaxed yet. It does not take much to imagine what is going to happen to the property market if curbs are eased to soon. So, for would-be buyers out there who are waiting for measures to be relaxed, it would be some time yet. Besides, some analysts have predicted that property prices may be bottoming out soon. It is perhaps timely to consider getting a property soon to boost your investment portfolio.
(Credits: BT 12/9/16)