SINGAPORE - There are fewer Housing Board flat upgraders chasing the condominium dream after several rounds of property cooling measures.
Among the reasons for the drop were three rounds of property curbs introduced in December 2021, September 2022 and April 2023, which tightened borrowing limits andfrom 12 per cent to 20 per cent for those buying their second residential property. “As banks are now required to use a higher mandatory interest rate of at least 4 per cent to compute the loan, some home buyers who were borderline cases were not able to secure their loan,” Mr Lim said.
This came as the number of newly launched units shrank 57 per cent to 4,528 in 2022 from 10,496 in 2021, noted Mr Lam Chern Woon, head of research and consulting at Edmund Tie. Nonetheless, resale transactions have been exceeding new sales since the second half of 2020, in part because the rise in resale condo prices has not been as sharp as that for new condos in the past two years, said OrangeTee & Tie senior vice-president for research and analytics Christine Sun.
“But a more than 50 per cent increase in rents from the fourth quarter of 2020 to the first half of 2023 made it harder for HDB upgraders. “Although some Singaporeans may take longer to scale the property ladder, they stand to gain if prices grow at a more sustainable rate.”Edmund Tie’s Mr Lam believes the overall impact will likely be minimal because “Prime and Plus flats will be in the minority of BTO flats offered”.