Governmental strictness regarding eligibility for home loan approval has impacted Singaporeans ever since the latest cooling measure on the home loan tenor. What is truly surprising is the paradigm shift in the mindset of would-be home buyers, who have been trying to focus their attention on how to continue in this market despite the difficulties they are facing.
As of October 2013, it is unknown whether there will be further cooling measures that will affect the market even more.
The changes adopted on 28 August 2013 were implemented immediately. The maximum loan tenure for HDB flats was shortened to 25 years, instead of 30 years, while the mortgage servicing ratio limit became 30 percent of a home buyer’s gross monthly income, compared to the previous 35 percent. Moreover, the maximum tenure for new housing Loans singapore and refinancing facilities was reduced from 35 to 30 years. The changes were not limited to those above; PRs (permanent residents) are also affected, as they are now required to wait three years after getting their permanent resident status to purchase flats, as opposed to previously, when they could buy a home immediately after receiving their status.
The number of property cycle analyses have determined that Singapore is most likely experiencing a late bull period. Strategies will allow you to recognize whether your property could ride through possible corrections. Some home buyers may choose to enter at the lowest point, while others at the current stage. However, a bad choice in this department can compromise the positive rating you may have acquired over the years.
The analyses suggest that this is a time when Singapore is close to the tipping point. The data analyzed to determine this are per square foot transacted pricings from the last two decades and the property caveats transacted.
How did sales change as a result of the changes made in August?
Sales of new homes shot up 742 units, according to the URA (Urban Redevelopment Authority). This means that compared to July there was a 54 % increase, and compared to August of last year they are 52 % lower.
Transactions soared in August in comparison with July with about 150 %, reaching over 1,400 units, including Executive Condominiums.