SINGAPORE: Measures to cool Singapore's property market are being implemented now to cut the risk of a "self-reinforcing cycle" of price increases, said National Development Minister Desmond Lee on Thursday (Dec 16).
He said the Government “carefully considered” the timing and scope of the new measures.
"While there is continuing uncertainty created by COVID-19, we have decided to move now to reduce the risk of a self-reinforcing cycle of price increases in the private and HDB resale markets, that will impact housing affordability," Mr Lee said at a media briefing.
The slew of property cooling measures, which kicked in on Thursday, include higher Additional Buyer’s Stamp Duties (ABSD), tighter loan-to-value (LTV) limits and lower Total Debt Servicing Ratios (TDSR).
MARKETS HAVE REMAINED BUOYANT
Despite the economic impact of COVID-19, prices in the private residential and HDB resale markets have risen considerably since the first quarter of 2020, said Mr Lee.
As a result, the House Price to Income (HPI) Ratio in both the private housing and HDB resale markets have been increasing – though they are still below their historical averages for now, he said. The HPI measures housing affordability.
“In particular, HPI for HDB resale flats reached 4.4 times in the first three quarters of 2021, which is well below its level a decade ago. However, it is now on a clear upward trend.”