As an effect to the numerous residential cooling measures, demand for lower priced apartments and condominium is expected to be the gain in particular properties that are under S$1.5 million.
In the latest measure, it affects the affordability factor based on the age of buyers.
For first time home buyers who are 35 years old and below earning a monthly household income of $12,000 and basing on debt servicing ratio of 35%, then they could look for homes worth about maximum $1.5 mil to $1.6 mil for a 30-year loan period.
If the same buyers want to reduce the loan term to 25 years, then basing on the same debt servicing ratio, the maximum purchase price would be $1.3 million to $1.4 million.
The maximum loan period that buyers can go for without paying higher cash and/or CPF deposit is determined by 65 minus age of buyers.
However, if the debt servicing ratio were to increase to 40%, then the maximum purchase price is corresponding increase.
There are ample homes that are within this sub-$1.5 million for home buyers to select from.
Analysts are expecting prices to increase still though at 0.1% to 0.3% for Q4 2012.
17 Nov 2012