Debated in Parliament on 1 Oct 2018.
Mr Ang Wei Neng asked the Minister for National Development (a) whether the latest round of property cooling measures have achieved the intended objectives; (b) what is the rationale for tightening the loan-to-value (LTV) limits for first-time property buyers; and (c) what is the overall impact on the first-time property buyers in view of the latest cooling measures.
The property cooling measures implemented on 6 July 2018 are intended to moderate the residential property market cycle and keep price increases in line with economic fundamentals. Loan-to-Value (LTV) limits were tightened across all housing loans, including those taken by first-time buyers, as the price increases prior to the measures were broad-based across the market, reflecting demand from all types of buyers. However, we maintained the Additional Buyer's Stamp Duty (ABSD) rates for Singapore Citizens and Permanent Residents buying their first residential property.
As the measures were only introduced recently, it is premature to conclude whether they have been effective. Nevertheless, there are early signs that the measures may have kept the pace of price increase in check. Based on the Urban Redevelopment Authority's (URA's) latest flash estimate of the Property Price Index, prices increased by 0.5% in the third quarter of 2018, compared to 3.9% and 3.4% in the first and second quarters of 2018 respectively.
The Government will continue to monitor trends in the property market and adjust our policies as necessary, to maintain a stable and sustainable property market.
PAPERCUTS