In this year’s Budget, there was no mention from the authorities on the easing of property cooling curbs which property players have said are part of the reason behind diminishing growth in the sector.
The property cooling curbs have put the brakes on plans for many investors and even home buyers who now have their loan options rather severely restricted. The total debt servicing ratio (TDSR) framework limits the amount that can be loaned based on a percentage of the borrower’s monthly income. Levy on the additional buyers’ stamp duty (ABSD) which increases the final buying price on a property, and many buyers and investors have shied away from putting their monies on local properties. They are instead looking outside of the country or into other kinds of investment opportunities.
The stock on unsold homes set to enter the market this year may depress prices even more but some analysts consider the government’s move to stand firm on their decision a wise one. As property prices are still high, and interest rates still considerably low, there is still space for them market to grow, albeit a little slower.
That will keep any possibility of a bubble at bay and though conservative, may be the best plan in the midst of a shaky global economic situation. Though private property prices have been falling, resale HDB flat prices have stayed stagnant for quite awhile now, which begs the question of who really benefits from these property cooling measures?