Tag Archives: Singapore Property Market

Curbing price hikes

Posted on 27 Oct 2009 | Comments Off on Curbing price hikes

Increase down payment ratio

IN ITS bid to cool the rapid rise in property prices, Hong Kong increased the down payment ratio to 40 per cent for properties above HK$20 million (S$3.6 million). For those priced below HK$20 million, the maximum loan of HK$12 million applies.

Although the increase in down payment affects mainly the high-end segment of Hong Kong’s property market, it illustrates two points. One, the down payment ratio of property purchases in Hong Kong seems to be at least 10 percentage points higher than Singapore’s. Two, an increase in down payment ratio is the most effective measure to curb property price increases in Singapore as a direct demand-side measure.

After all, an increase in down payment ratio was adopted in the late 1990s in Singapore, which led to a relatively steep decline in property prices. However, currently, assuming a loan-to-value ratio of 80 per cent requirement typical of most banks, only 5 per cent cash is necessary. The remaining 15 per cent is settled by the buyer’s CPF. Continue reading →

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Check actual space of shoebox units

Posted on 25 Oct 2009 | Comments Off on Check actual space of shoebox units

I refer to last Sunday’s article, ‘The land of shrinking apartments?’.

Even if we have to settle for shoeboxes, we should spend our precious money wisely, choosing well-fitting boxes.

I saw in the sample floor plan of a Suites @ Guillemard unit that there were two large bay windows forming part of the 258sq ft area, which at first looked big enough to accommodate another bed and sofa.

I understand the plan was only an approximation, but I measured the space depicted anyway and found that the bay windows took up 28.9sq ft of the area.

Another 9.6sq ft space attached to a bay window was unlabelled and might be an air-conditioner ledge or planter box. This left only 219.5 sq ft of actual floor space, or 85per cent of the original 258 sq ft figure.

If one wants to buy 258 sq ft of space, it would be a good idea to buy 258 sq ft of actual floor space, and not 219.5 sq ft, with the floor area shrunken by bay windows and other architectural gimmicks, which are usually there for the benefit of someone else other than the home buyer. Continue reading →

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