Heard there might be a CM8 on this Friday is it true ?

[thomastansb]

100k divide by 12 times 30% = $2500

Then you take interest rate of 4.5% (some banks use 4%, some use different % but usually, between 4 to 4.5%) and 30 years loan (assuming you are below 35) and work out the amount. Most banks use their board rate so I know for OCBC, it is 4.5%.

Based on 100k income, it worked out to $493,400 loan amount or 616k purchase price. A rather low purchase price based on a monthly income of $8,333.

So someone who is on a 90th percentile income or top 10% earner in Singapore (around 7k a month only) cannot even buy a 600k house. That is sad. And 600k can barely get a MM nowadays. Even in OCR.

may i know for 100k income, what will 30% DSR like?

[RCT]

Actually does the calculation include cpf?

[newbie11]

Thomas calculation is quite right. it depends on bank's interpretation of your income breakdown. if most of income is from basic salary, it should be recognised in full. if your income is mostly comm-based, abt 70% of it will be recognised. if self-employed and little declaration, then die la.. acknowledgement of rental income also depends on bank.

anw, note that this is about MSR.. there is still a DSR criteria. But if u die at MSR stage, then sure die la..

imagine those high sales income folks.. suddenly they also cant fulfill the MSR criteria to buy high quantum prop.

[newbie11]

yup, in particular:


"When contacted, MAS would not comment on whether it has any impending plan to extend a prescriptive MSR cap to private home mortgages (like the one it imposed on HDB flats as part of last month's property cooling measures). However, it confirmed advising financial institutions (FIs) that they should also consider applying the MSR to loans and refinancing facilities for private residential properties. "In addition to applying a MSR for HDB flats, MAS expects FIs to continue to be prudent in assessing the repayment ability of borrowers for all residential property loans," it added.

Talk in some circles is that MAS could roll out a more prescriptive cap on MSR for private home loans after it reviews an audit of banks' home mortgages portfolio conducted late last year."

bro, since u r in the home loan biz, assuming the 30% MSR is implemented. does that mean asset based financing is dead? surely pay 50% downpayment and borrow 50% is already very very safe for the banks?

IMO, its safe.. but u can still fail MSR!! imagine those average-income folks who make lots of $ from stocks. cant buy too. got 500k for deposit, pay 7% absd, but salary 5k, also LL.

[bargain hunter]

for these individuals, they will need to incorporate a company. then need to pay 80% downpayment and can only borrow 20%?

IMO, its safe.. but u can still fail MSR!! imagine those average-income folks who make lots of $ from stocks. cant buy too. got 500k for deposit, pay 7% absd, but salary 5k, also LL.

[indomie]

Not much relevance between loose monetary policy and increasing the share prices to strengthen the economy.

To keep USD valuable it must be backed by something valuable. At this moment the fed is printing so much money. The only way to keep the demand for USD is to inflate share prices denominated in USD. The fed will make sure Dow Jones goes higher for years to come.

[RCT]

I think this time they let out the wind as no scared people go and buy... As this is a killer blow... Even if u sell your hdb and have cash but low salary, u still cannot buy.

This is the killer blow, even property agent just email me saying forget it...

Now if want to buy is for those high income high cash families...

[august]

will push buyers to foreign properties.. is that in the interest of spore? lol

[phantom_opera]

How is MSR of 30% different from LTV of 40-50% for 2nd loan?

So MSR 30% will only affect if it is the first loan isn't it?

Does that mean HDB upgraders with family income about 100k+ with fully paid up HDB loan will not be able to upgrade to a 2br OCR condo?

Then for those staying in condo/landed with family median income > 15k ... this group of ppl will then be able to grep another condo after a correction of 10% ??

IS this a political suicide?

[phantom_opera]

I think recent Bernanke's speech in congress really make MAS uncomfortable ... Pimco even suggests low int rate to sustain to 2030

It sounds like Japan II

[indomie]

I think recent Bernanke's speech in congress really make MAS uncomfortable ... Pimco even suggests low int rate to sustain to 2030

It sounds like Japan II

Petro dollar policy is losing its potency. What we are looking at now is the replacing flow of funds from US treasuries into US shares. The aim of course to keep the demand for USD intact.

[thomastansb]

MSR is directly proportionate to your income.
LTV is proportionate to your cash at hand.

If you have cash, you can still downpay 60% and buy as many as you want.

If you have income (eg: 1M salary a year), MSR or DSR don't affect you because you can down 20% and borrow the rest.


So bottom line.......


If you have cash but no income, you can't borrow because your DSR doesn't meet 30% of income. But you can pay in full if you have that much cash.

If you have income but no cash, you can't buy because LTV doesn't pass.

If you have no cash, no income, then go for BTO

How is MSR of 30% different from LTV of 40-50% for 2nd loan?

So MSR 30% will only affect if it is the first loan isn't it?

Does that mean HDB upgraders with family income about 100k+ with fully paid up HDB loan will not be able to upgrade to a 2br OCR condo?

Then for those staying in condo/landed with family median income > 15k ... this group of ppl will then be able to grep another condo after a correction of 10% ??

IS this a political suicide?

[minority]

100k divide by 12 times 30% = $2500

Then you take interest rate of 4.5% (some banks use 4%, some use different % but usually, between 4 to 4.5%) and 30 years loan (assuming you are below 35) and work out the amount. Most banks use their board rate so I know for OCBC, it is 4.5%.

Based on 100k income, it worked out to $493,400 loan amount or 616k purchase price. A rather low purchase price based on a monthly income of $8,333.

So someone who is on a 90th percentile income or top 10% earner in Singapore (around 7k a month only) cannot even buy a 600k house. That is sad. And 600k can barely get a MM nowadays. Even in OCR.

So assuming a couple than can borrow up to 1.2m

[minority]

what's the link between raising interest rates and the flow of hot money into equities?

Wat cock u talking? I talking MSR. Small boy don't know pls don't act smart.

[kane]

yawn ... Temasek's next few years return is going to be close to zero if they kill the developers and banks

They still have dividends mah. Heh

[thomastansb]

I mean if the couple salary is 200k combined, then logically, can buy a 1.2 million house with 80% loan. This is based on 30% DSR as what everyone is talking now.

If Government wants to be funny, they can always lower to 20% DSR, up the ABSD, lower the LTV. That will be CM8, 9, 10 etc... If 20% DSR + 25% ABSD + 20% LTV, even the most bullish of the bullish will turn bear immediately.

So assuming a couple than can borrow up to 1.2m

[phantom_opera]

I mean if the couple salary is 200k combined, then logically, can buy a 1.2 million house with 80% loan. This is based on 30% DSR as what everyone is talking now.

If Government wants to be funny, they can always lower to 20% DSR, up the ABSD, lower the LTV. That will be CM8, 9, 10 etc... If 20% DSR + 25% ABSD + 20% LTV, even the most bullish of the bullish will turn bear immediately.

that effectively means majority of HDB upgraders cannot upgrade to PC ...


median family household income for those staying at 5r / bigger is around 9k only (i.e. 108k pa) ... they will have to make sure this group of ppl can still upgrade

if too drastic, not only HDB upgraders not happy, developers and banks can kiss good bye and STI will crash below 3k immediately as the 3 local banks + developers has a lot of weightage

[silver023]

for these individuals, they will need to incorporate a company. then need to pay 80% downpayment and can only borrow 20%?

Cannot ba.. new rules: LTV for companies only 20%, plus 15% ABSD

[buttercarp]

For pte property, the owner does not need to be the borrower of the home loan, ie someone can borrow the loan on the owner's behalf.

So if the MSR is implemented, does it mean the owner cannot get someone to borrow on his behalf, if the owner's salary is low or has no salary?

[kane]

95% cash that would mean. Ha. Assume cpf maxed out.

[p3nboy]

there will be more CMs....else who is going to buy the properties in JB?

[chestnut]

For pte property, the owner does not need to be the borrower of the home loan, ie someone can borrow the loan on the owner's behalf.

So if the MSR is implemented, does it mean the owner cannot get someone to borrow on his behalf, if the owner's salary is low or has no salary?

It is going to get get tougher and tougher to borrow in the future. The key message from the higher echelon is "prudence".

Did you cash out on your property??? Do it only if you know how to invest. If not, please be contented. Hahahahahaha

[4wheels]

if you are owning a few it maybe time to cash out 1 or 2 for better return than rental.

Top Global adjusts condo prices in response to cooling measures

SINGAPORE — Real estate group Top Global has made a 10 to 15 per cent downward adjustment to the prices of its two soon-to-be-launched condominiums in response to the recent slew of property cooling measures, and further changes may be made according to demand.

The freehold residential developments — R Maison and E Maison — are situated at Braddell Road and Somerville Walk, and are targeted at mid- to high-income earners. After the reductions, the 175 units at the two complexes, which are together called The Maisons, have an anticipated price range of between S$1,350 and S$1,450 per square foot.

“Given that The Maisons are among the first developments rolled out after the recent Additional Buyer’s Stamp Duty (ABSD), our pricing strategy will factor in the additional cost of home purchases,” said Mr Hano Maelo, Chief Executive Officer of Top Global.

The ABSD, which was one of the additional property cooling measures announced by the Government on Jan 11, applies to second homes for Singaporeans and first homes for permanent residents.

Ms Jennifer Chang, Chief Operating Officer and Executive Director of Top Global, added that the company will adapt its pricing and marketing strategy after seeing the response to R Maison, which is due to be launched by the end of the month. E Maison is scheduled to launch early next month.

Top Global is upbeat about prospects for the two developments despite the cooling measures.

“Our main selling points are value and location … as long as interest rates remain low and buyers continue to enjoy ample liquidity, we envisage a healthy demand,” Mr Maelo said.

The full impact of the cooling measures has yet to be seen. The most recent property sales data indicated that demand has stayed robust, but market watchers have cautioned that it might not be until this month or the next before a true picture emerges of how the measures have affected sales and prices.

Deputy Prime Minister Tharman Shanmugaratnam said in an interview with Bloomberg last week that there is still “some ways to go” before property prices are at an acceptable level.

[thomastansb]

Can. But that someone has got to know his LTV will be reduce to 50% the next time he buys if that is his first property as borrower. Or if it is his second, he can only get 50% loan. Usually, people don't do it unless it is a close friend/family member because the risk is on the borrower.

For pte property, the owner does not need to be the borrower of the home loan, ie someone can borrow the loan on the owner's behalf.

So if the MSR is implemented, does it mean the owner cannot get someone to borrow on his behalf, if the owner's salary is low or has no salary?

[chiaberry]

After a while...people will run out of children and other relatives whose name can be "borrowed" for getting a housing loan.

In any case MSR makes it difficult to use other peoples' names anyway. The banks will have to run v. stringent checks on borrowers from now on. Cannot anyhow declare income. They will check and double check.

Goodness gracious.....Govt already send signal not to touch property unless you have the cash.....don't get the message ah?

[kane]

1350-1450psf, sounds kike fair value. No one sensible would touch it at their prediscounted price.

[phantom_opera]

in China ... couples rush to divorce to avoid capital gain tax

Singapore still early in the games lah

If you own any OCR condo bought below 1kpsf ... even say you already make 80% (1800psf) who wants to sell now ... kiqiu

bear in mind M3 is up 82% since 2007 and we are not living in an isolated island ... Beijing MNC pay already matching Singapore level ... China M2 growth target is 13% in 2013 vs 13.8% in 2012

MP3 already proposing 1,500 as min wage, with WCS (Wage Credit Scheme) ... inflation will raise its ugly head again

[radha08]

bottomline what does the govt want....population increase to 6.9m...but dont want people to buy...or they want to give priority to 1st timers...

[Cupcakes]

bottomline what does the govt want....population increase to 6.9m...but dont want people to buy...or they want to give priority to 1st timers...

Govt wants us to realize they are always right n we should listen to them in the first place. Don't kpkb. so they are thinking to crash the market, crash the economy to prove to us the govt are right from the beginning. See if we dare to be champion whinner next time.

[mcmlxxvi]

if you are owning a few it maybe time to cash out 1 or 2 for better return than rental.

Top Global adjusts condo prices in response to cooling measures

SINGAPORE — Real estate group Top Global has made a 10 to 15 per cent downward adjustment to the prices of its two soon-to-be-launched condominiums in response to the recent slew of property cooling measures, and further changes may be made according to demand.

The freehold residential developments — R Maison and E Maison — are situated at Braddell Road and Somerville Walk, and are targeted at mid- to high-income earners. After the reductions, the 175 units at the two complexes, which are together called The Maisons, have an anticipated price range of between S$1,350 and S$1,450 per square foot.

“Given that The Maisons are among the first developments rolled out after the recent Additional Buyer’s Stamp Duty (ABSD), our pricing strategy will factor in the additional cost of home purchases,” said Mr Hano Maelo, Chief Executive Officer of Top Global.

The ABSD, which was one of the additional property cooling measures announced by the Government on Jan 11, applies to second homes for Singaporeans and first homes for permanent residents.

Ms Jennifer Chang, Chief Operating Officer and Executive Director of Top Global, added that the company will adapt its pricing and marketing strategy after seeing the response to R Maison, which is due to be launched by the end of the month. E Maison is scheduled to launch early next month.

Top Global is upbeat about prospects for the two developments despite the cooling measures.

“Our main selling points are value and location … as long as interest rates remain low and buyers continue to enjoy ample liquidity, we envisage a healthy demand,” Mr Maelo said.

The full impact of the cooling measures has yet to be seen. The most recent property sales data indicated that demand has stayed robust, but market watchers have cautioned that it might not be until this month or the next before a true picture emerges of how the measures have affected sales and prices.

Deputy Prime Minister Tharman Shanmugaratnam said in an interview with Bloomberg last week that there is still “some ways to go” before property prices are at an acceptable level.

Smart marketing ploy with free press coverage and media exposure. Dont even need to spend on advertising.

Probably the large units at those psf. Its not an mmful project.