Borrowers’ income level and thus their ability to repay are paramount and the banks also consider borrowers’ credit history and the market valuations.

Some property analysts have observed that asking prices for private home have been shaved off by about 5% to 10% amidst deepening worries of a possible economic slowdown in the US. The big three are now financing only up to 80% of current market valuation. This means that borrowers need to fork out more cash and in the near future when more new projects are ready for occupancy, the banks may even reject some home loan applications.

As of now, due to the Deferred Payment Scheme offered by most developers, mortgage growth in Singapore appeared normal at under 3% over last year. (5 Sept)

Edited by Sam Gian – Independent Real Estate Sale Consultant