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Thread: Where to get sibor+0.55% for 1mil mortgage loan??

  1. #1
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    Default Where to get sibor+0.55% for 1mil mortgage loan??

    Singapore Homes Most Affordable as Rents Climb: Mortgages
    By Pooja Thakur and Sanat Vallikappen - 2012-06-26T19:00:59Z
    Shivram Anantharaman paid a monthly rent of S$2,650 ($2,069) until March. Now, he’s paying S$40 less every month after buying a three-bedroom condominium in Singapore’s East Coast region.
    “The clincher in Singapore is that monthly installments toward repayment of your loan are lower than what you would pay in rent,” said Anantharaman, a private banker at ICICI Bank Ltd., who took out a S$1.04 million mortgage for his S$1.3 million property late last year. “It’s one of the few countries in the world where that is possible,” because of the low interest rates, he said.
    Homebuyers like Anantharaman are taking advantage of mortgage rates at an all-time low in the Southeast Asian island- state, even as prices are almost at a record high and the government introduced measures to cool the property market. Home affordability in Singapore has risen to the highest in a decade because of historically low interest rates and flexible payment options available to buyers, according to Jefferies Group Inc.
    Average mortgage rates are about 70 basis points above the Singapore Interbank Offered Rate, or Sibor, according to Maybank Kim Eng Holdings Ltd. The three-month Sibor is at an all-time low at just under 0.4 percent, compared with a peak 3.56 percent in 2006, according to data compiled by Bloomberg. A basis point is 0.01 percentage point.
    Asia’s Lowest
    Anantharaman, 29, pays 55 basis points over Sibor on a 40- year mortgage, effectively giving him a home-loan rate of less than 1 percent. By contrast, mortgage rates in India, his home country, are about 11 percent, according to Rajan Tandon, the Singapore-based head of Housing Development Finance Corp., the largest home-loan provider in India.
    Mortgage rates in Singapore are the lowest in Asia, followed by Hong Kong, said Sanjay Jain, an analyst at Credit Suisse Group AG in Hong Kong. His analysis does not include Japan.
    Hong Kong’s average mortgage rate is about 2.15 percent, while China’s is 7.43 percent, according to Barclays Plc. Indonesian rates range from 8 percent to 10 percent while in South Korea they are about 5 percent, according to the bank. Hong Kong banks raised interest rates last year from the lowest since 2004 to counter a drain on liquidity as deposits were moved out of Hong Kong dollars into yuan. Similar to Singapore, Hong Kong mortgage rates are set according to the Hong Kong Interbank Offered Rate or the prime rate.
    In New York, the $1.1 million median price of a condominium makes renting a better option, with the median monthly rent of $3,100. The average rate for New York 30-year fixed jumbo mortgage is 4.24 percent this week, according to Bankrate.com. Using those numbers, the monthly payment for a mortgage would be more than $4,500.
    Higher Levy
    Demand for homes in Singapore has prompted the government to introduce five rounds of measures since 2009 to rein in property prices. The latest, in December, imposed additional taxes on private residential property purchases by foreigners and existing homeowners to curb excessive investment that may stoke risks in the banking system and economy.
    Foreigners and corporate entities have to pay an extra 10 percent stamp duty under the rules introduced on Dec. 8. The extra levy is 3 percent for permanent residents purchasing a second home, as well as for citizens’ third residences.
    “The property market continues to be buoyant,” said Linda Sim, Singapore-based senior vice president of secured lending at DBS Group Holdings Ltd., Southeast Asia’s largest bank. “Foreign buying is currently on the lukewarm side, but it’s replaced by local buyers, with the bulk of those purchases for own occupation.”
    Affordability Measure
    A measure of home affordability in Singapore is below 35 percent, based on mortgage payments and median household income, according to the May report by Jefferies. The lower the value, the higher the affordability, according to the report.
    The monthly mortgage repayment for a private condominium in Singapore in the first quarter was 36.7 percent of a two-income household’s average earnings per month, the lowest since 2005, according to data compiled by Bloomberg. The calculations are based on the average price of a 100-square-meter (1,076-square- feet) condominium, the mortgage set at the average Sibor rate and a 30-year repayment period.
    Variable-rate and Sibor-pegged packages are more popular among home-loan borrowers than fixed-rate packages because they expect interest rates to remain low, said Phang Lah Hwa, the head of consumer secured lending at Oversea-Chinese Banking Corp. (OCBC), Southeast Asia’s second-largest bank. The Singapore-based bank offers fixed, variable and Sibor-pegged home loans.
    Inflation Hedge
    The low interest rates are luring buyers to real estate as “a hedge against inflation,” said Wilson Liew, Singapore-based analyst at Maybank Kim Eng, a unit of Malayan Banking Bhd., Malaysia’s largest lender. Property accounted for 60 percent of total household wealth in the island-state in 2010, up from 56 percent in 2005, according to government data.
    The Monetary Authority of Singapore does not control the monetary system via interest rates. Instead, it manages the Singapore dollar exchange rate against a trade-weighted basket of currencies of the island’s major trading partners and competitors.
    Most floating-rate mortgages are priced at a margin above the three-month Sibor or the three-month swap offered rate, said Liew at Maybank. The swap rate tracks U.S. interest rates and foreign-exchange movements quite closely, he said. The swap rate will remain between 0.4 percent and 0.6 percent for the next six months, Maybank forecasts.
    Mortgage Loans
    Housing loans in Singapore account for almost a third of the lending market, higher than in other countries in the region, said Wee Siang Ng, a banking analyst at BNP Paribas Securities Singapore Pte. In Indonesia, they made up 9 percent of total outstanding lending as of the end of March, and 20 percent in Thailand as of April.
    “The importance of housing loans to the banking system is very high,” said Ng. “The immense competition for them among banks ensures that they are offered at low spreads above the Sibor.”
    Still, concerns over Europe’s sovereign debt crisis and China’s economic slowdown are denting demand as the supply of homes grows, said Maybank’s Liew. Sales this year have mainly been driven by so-called shoebox developments, raising expectations the government may step in with more cooling measures, he said. Shoebox apartments in Singapore are smaller than 550 square feet.
    “The longer the euro-zone crisis and China growth concerns prevail, the more likely it is that buying confidence may begin to wane in fear of greater repercussions on the Singapore economy, and hence job stability,” Liew said. “Demand may dry up overnight if there is a crisis of confidence.”
    Sales Fall
    Singapore’s May private home sales fell 32 percent from a month ago to the lowest this year. Private home sales fell to 1,702 units last month from this year’s peak of 2,496 units in April, according to data from the Urban Redevelopment Authority.
    “Developers’ sales had been very robust as buyers continued to flock to the property market amid persistently low interest rates and availability of small units in the suburban areas,” OCBC’s Phang said. “We saw a 30 percent increase in home loans take-up in the first four months this year compared to the same period in 2011.”
    Financing Options
    Wider financing options are also helping lure buyers. Permanent residents and citizens can use part of the payments that have accumulated or get paid every month into Singapore’s Central Provident Fund, the national pension, to make down payments on property purchases and to service the monthly mortgage installments, according to the fund.
    Demand is driven by buyers who want to use the homes to live in, rather than speculative trading in the property market, said DBS’s Sim. About 25 percent of the mortgages taken out this year were for investments or speculation, down from 35 percent a year ago, she said, citing property usage details given by customers when a loan application is made.
    Prem Bhagat, 36, a human resources manager at Cisco Systems Inc. (CSCO), said he wants to buy a home in Singapore to reduce the S$3,200 he currently pays every month in rent for his east Singapore condominium. When he buys, he intends to restrict his monthly payments to S$2,800 to S$3,000, he said.
    “The current interest rates are way too low, the CPF takes care of a large portion of the monthly payments, and there’s not too much of a risk of property prices coming down in Singapore over the longer term,” said Bhagat.
    To contact the reporters on this story: Pooja Thakur in Singapore at [email protected]; Sanat Vallikappen in Singapore at [email protected]
    To contact the editors responsible for this story: Andreea Papuc at [email protected]; Chitra Somayaji at [email protected]; Rob Urban at [email protected]

  2. #2
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    wow... me just did some quick guesstimation...

    - there are so many new compact 2bdr condo, <750sqft
    - let's say, those 2bdr are 1100psf,... so each will cost ~825K...
    - 80% loan of 825K is 660K size...
    - instalment: S$1863/month, $660K size, 1%, 35yr tenure, for a new 2bdr condo...
    - that's the same amount of rent for a 3rm hdb flat... and yet part of this instalment will be paid by cpf...


    like that hor,... is like 50K unsold condo units stock also can be easily makan-ed by these PMET PRs... once they have saved enough for the 20% downpayment...


    => i'm going to hold tight tight throughout 2015 (and beyond) liow...

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    Quote Originally Posted by ikan bilis
    wow... me just did some quick guesstimation...

    - there are so many new compact 2bdr condo, <750sqft
    - let's say, those 2bdr are 1100psf,... so each will cost ~825K...
    - 80% loan of 825K is 660K size...
    - instalment: S$1863/month, $660K size, 1%, 35yr tenure, for a new 2bdr condo...
    - that's the same amount of rent for a 3rm hdb flat... and yet part of this instalment will be paid by cpf...


    like that hor,... is like 50K unsold condo units stock also can be easily makan-ed by these PMET PRs... once they have saved enough for the 20% downpayment...


    => i'm going to hold tight tight throughout 2015 (and beyond) liow...
    Definitely, hold tight tight... these PRs are also planning the same.

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    Indeed, many of my PR friends looking to buy instead of rent...

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    Quote Originally Posted by ysyap
    Indeed, many of my PR friends looking to buy instead of rent...
    One of the big reasons why price keeps going up even though rents do not necessarily show the same trend. The moment it falls within their reach, they buy.

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    Quote Originally Posted by Kelonguni
    One of the big reasons why price keeps going up even though rents do not necessarily show the same trend. The moment it falls within their reach, they buy.
    Or when they have saved enough for the downpayment...

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    Quote Originally Posted by ysyap
    Indeed, many of my PR friends looking to buy instead of rent...
    everybody buy, then who are renting...
    so some positive note on the last CM, foreigner who do not want to pay extra 10% ABSD, continue to rent

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    So anymore banks offering SIBOR + 0.55% now?

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    Quote Originally Posted by coolchoc
    So anymore banks offering SIBOR + 0.55% now?
    state bank of india or Bank of China?

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    Quote Originally Posted by coolchoc
    So anymore banks offering SIBOR + 0.55% now?
    I think most still > = 1% la....don't tell me already below 1%??

    If below 1% then can go take loan and put into fix D Liao and earn the different...

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    Quote Originally Posted by newbie11
    Maybe to cater to the nri community in Sg.. Made in India! Cheap cheap gooda.. Will go check if they willing to offer me low rates too. Hehe

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    Quote Originally Posted by Vincegoh
    Maybe to cater to the nri community in Sg.. Made in India! Cheap cheap gooda.. Will go check if they willing to offer me low rates too. Hehe
    You can contact the banker through the link. need more support, else startup how to survive?

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    sounds like my tenant...

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    Quote Originally Posted by newbie11
    You can contact the banker through the link. need more support, else startup how to survive?

    What happens when a bank collapsed? Those who took loans from them how? Will their creditors have "first charge", like cpf board previously, and they can recall the $$ owed?

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    Quote Originally Posted by coolchoc
    What happens when a bank collapsed? Those who took loans from them how? Will their creditors have "first charge", like cpf board previously, and they can recall the $$ owed?
    Roly8, heres ur chance to impress ur prospectie father in law.

    This qn has been asked before.
    Anyway, if u have deposit 1milion with citibank and 1 million mortgage with citibank,
    If citibnk bankrupt, u lose ur entire (less deposit insurance) BUT u still owe $1mil to citibank or whichever bank takeover citibank.
    No such thing as crossing off.
    So to be safe,keep deposit in singapore bank and take mortgage from foreign bank whicn may give u better mortgage rates.

  18. #18
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    Quote Originally Posted by coolchoc
    What happens when a bank collapsed? Those who took loans from them how? Will their creditors have "first charge", like cpf board previously, and they can recall the $$ owed?
    ask people in greece and spain.....they will tell u

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    Default Only up to S$50,000 ::consolation for $1 million deposit?

    Quote Originally Posted by hopeful
    Roly8, heres ur chance to impress ur prospectie father in law.

    This qn has been asked before.
    Anyway, if u have deposit 1milion with citibank and 1 million mortgage with citibank,
    If citibnk bankrupt, u lose ur entire (less deposit insurance) BUT u still owe $1mil to citibank or whichever bank takeover citibank.
    No such thing as crossing off.
    So to be safe,keep deposit in singapore bank and take mortgage from foreign bank whicn may give u better mortgage rates.
    The Deposit Insurance Scheme protects depositors in the event a DI Scheme member fails by compensating insured deposits up to a maximum of S$50,000

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