New HDB loan limit: Will it affect resale flat prices? Analysts weigh in
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In the latest round of property cooling measures, the government announced on Monday (Aug 19) night that the maximum loan that home buyers can take from the Housing and Development Board (HDB) will be lowered from the next day. Speaking to reporters on TuNew HDB loan limit: Will it affect resale flat prices? Analysts weigh in
In the latest round of property cooling measures, the government announced on Monday (Aug 19) night that the maximum loan that home buyers can take from the Housing and Development Board (HDB) will be lowered from the next day. Speaking to reporters on Tuesday (Aug 20), National Development Minister Desmond Lee said that the move - which reduces the loan-to-value (LTV) limit from 80 per cent to 75 per cent - will encourage more prudent borrowing and dampen demand at the higher end of the HDB resale market. Lee said his ministry has observed that buyers who take loans at higher LTV ratios «disproportionately» buy larger flats and pay higher prices, which in turn contribute to the overall higher prices in the HDB resale market. The minister also noted that in the last one-and-a-half years, million-dollar flats make up only about two per cent of all transactions. «The problem is that this has caused Singaporeans to be concerned about the affordability of resale flats as a whole,» Lee said about this apparent «market psychology». Read more