Mean and Median Mortgage Service Ratio for Single HDB Flat in Last Five Years

Debated in Parliament on 7 Oct 2019.

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Mr Leon Perera asked the Minister for National Development for the mean and median mortgage service ratio (MSR) over the last five years for those servicing a mortgage on a single HDB flat, and how many HDB lessees were allowed to exceed the MSR ceiling.
Minister Lawrence Wong responded that from 2014 to 2018, the mean and median MSRs for HDB housing loans were stable at around 20% for new flats and 25% for resale flats at key collection, with buyers required to dispose of other properties.
The MSR cap is 30% of a buyer's income, but some buyers shorten their loan tenure to reduce interest, leading to a small number—around 3% of 2018 key collectors—having monthly instalments that exceed the 30% cap despite the loan adhering to the MSR over the full tenure.

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Leon Perera

Mr Leon Perera asked the Minister for National Development in each of the last five years (a) what has been the mean and median mortgage service ratio (MSR) for those servicing mortgage loans for only a single HDB flat; and (b) how many HDB lessees have been allowed to exceed the MSR ceiling, if any.

Lawrence Wong

Between 2014 and 2018, the mean and median mortgage service ratios (MSRs) of HDB housing loans disbursed at key collection were similar – these ratios have been stable at around 20% for new flat purchases and 25% for resale flat purchases. As flat buyers are required to dispose of any existing property after they collect the keys to their flat, they will be servicing an HDB housing loan for a single flat.

The Mortgage Servicing Ratio (MSR) cap of 30% of flat buyers' income is one of the criteria used to determine the maximum loan amount that flat buyers are eligible for when they apply for a housing loan to purchase an HDB flat or executive condominium. However, some flat buyers choose to shorten their loan tenure to minimise interest costs. For a small number of such flat buyers, around 3% of those who collected keys to their HDB flats in 2018, while their approved loan amount adheres to the MSR cap over the maximum applicable loan tenure, their mortgage instalment over the shortened loan tenure may exceed 30% of their monthly income.

Summary written by AI (learn more)

Mr Leon Perera asked the Minister for National Development for the mean and median mortgage service ratio (MSR) over the last five years for those servicing a mortgage on a single HDB flat, and how many HDB lessees were allowed to exceed the MSR ceiling.
Minister Lawrence Wong responded that from 2014 to 2018, the mean and median MSRs for HDB housing loans were stable at around 20% for new flats and 25% for resale flats at key collection, with buyers required to dispose of other properties.
The MSR cap is 30% of a buyer's income, but some buyers shorten their loan tenure to reduce interest, leading to a small number—around 3% of 2018 key collectors—having monthly instalments that exceed the 30% cap despite the loan adhering to the MSR over the full tenure.

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Mean and Median Mortgage Service Ratio for Single HDB Flat in Last Five Years | PAPERCUTS

Mean and Median Mortgage Service Ratio for Single HDB Flat in Last Five Years

Debated in Parliament on 7 Oct 2019.

Summary written by AI (learn more)

Mr Leon Perera asked the Minister for National Development for the mean and median mortgage service ratio (MSR) over the last five years for those servicing a mortgage on a single HDB flat, and how many HDB lessees were allowed to exceed the MSR ceiling.
Minister Lawrence Wong responded that from 2014 to 2018, the mean and median MSRs for HDB housing loans were stable at around 20% for new flats and 25% for resale flats at key collection, with buyers required to dispose of other properties.
The MSR cap is 30% of a buyer's income, but some buyers shorten their loan tenure to reduce interest, leading to a small number—around 3% of 2018 key collectors—having monthly instalments that exceed the 30% cap despite the loan adhering to the MSR over the full tenure.

Questions identified by AI (learn more)

Full Transcript

Leon Perera

Lawrence Wong

Summary written by AI (learn more)

Mr Leon Perera asked the Minister for National Development for the mean and median mortgage service ratio (MSR) over the last five years for those servicing a mortgage on a single HDB flat, and how many HDB lessees were allowed to exceed the MSR ceiling.
Minister Lawrence Wong responded that from 2014 to 2018, the mean and median MSRs for HDB housing loans were stable at around 20% for new flats and 25% for resale flats at key collection, with buyers required to dispose of other properties.
The MSR cap is 30% of a buyer's income, but some buyers shorten their loan tenure to reduce interest, leading to a small number—around 3% of 2018 key collectors—having monthly instalments that exceed the 30% cap despite the loan adhering to the MSR over the full tenure.

Questions identified by AI (learn more)

Mean and Median Mortgage Service Ratio for Single HDB Flat in Last Five Years

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Questions Identified

Full Transcript

Leon Perera

Lawrence Wong

Summary

Questions Identified

Mean and Median Mortgage Service Ratio for Single HDB Flat in Last Five Years

Summary

Questions Identified

Full Transcript

Leon Perera

Lawrence Wong

Summary

Questions Identified