Sunday, October 7, 2012

New Cooling Measures?

A Housing and Development Board (HDB) executive maisonette in Bishan sold for $980,000. In the third quarter from the April-June, Singapore private home prices rose 0.5%. Resale prices of HDB apartments rose again by 2% quarter-on-quarter. All these are signs that the Singapore government’s cooling measures had failed miserably. So what does the Singapore government do?

It set new cooling measures! From Oct 6, Singaporeans can only have a max tenure of 35 years!

Uh? That’s my reaction when I heard it on the news. I mean the average loan for residential property is between 25 to 30 years. So can someone please tell me how does a max tenure of 35 years help cool the property market?

The biggest reasons for rising property prices are increased immigration, low interest rates and rapid credit growth. Since when did the length of the loan arrangement became a major factor? If the Singapore government says that this new rule will cool the market, they are either wrong or they are not serious in lowering property prices.


Anonymous said...

The govt has never admitted to being wrong. Even now, as it attempts to hold a conversation with us on how we'd like to see this country, we are being asked to look at this future through the PAP's spectacles. It has made clear that policies now in place will stay in place. We'll look at them them, then leave them as we found them.

They have not said the latest ruling will cool the market. It is there to show they are doing something, certainly not to bring property prices down. If it did, how would we have asset enhancement? And if they're not slogging to pay for million dollar public housing, people might find time to do more than just bitch online about life here.

Ghost said...

What I like to know is why do they believe capping the loan tenure at 35 years will have any effect whatsoever? No one I spoke to so far believe it will have any effect at all so I have a hard time thinking the government have information that shows otherwise. If they do, I would like to see it.

Anonymous said...

U missed out on the borrower age n LTV factor.

Ghost said...

Frankly none of the factors in the new cooling measure truly impressed me. I just can't see how they will work