Backed by the strengthening US Dollar, and the Sibor (Singapore Interbank Offered Rate) and Swap Offer Rate at their highest in five years; home buyers are understandably iffy about the financial difficulties they might eventually face. The three-month Sibor rate has reached 1 per cent last week, comparable to the boom in 2008.
Fixed home loan rates are locked in for a specific period of time (usually two to five years) and banks and brokers alike are reporting up to 80 per cent of their clientele showing interest and taking up fixed rates. Though the rates may be higher, the risk of fluctuating interest rates are reduced. It all takes detailed financial planning and a good understanding of one’s capabilities. How soon do you estimate being able to pay of bulk of your loan? How financially flexible do you need to be?
Location and rental potential seems to have trumped floor area and will properties with a lower total quantum continue to take the front of the race as the market leader?