Property News

September 2022 Cooling Measures Announced: An Attempt To Cool The Hot Property Market And How It May Affect You

  • September 30, 2022
  • 7 min read
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Ryan J

A seasoned content strategist with over 17 years in the real estate and financial journalism sectors, Ryan has built a reputation for transforming complex industry jargon into accessible knowledge. With a track record of writing and editing for leading financial platforms and publications, Ryan’s expertise has been recognised across various media outlets. His role as a former content editor for 99.co and a co-host for CNA 938’s Open House programme underscores his commitment to providing valuable insights into the property market.

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Bear in the big blue house
Bear in the big blue house
1 year ago

Agreed that the change in LTV won’t really make waves, as most of those who are able to buy the higher end HDBs would be taking bank loans anyway. Those poorer ones who are unable to accept that they should just be buying cheaper properties will find ways and means to scrape the upfront payment, like you mentioned.

Sidenote: you were quite charitable with your choice of words in describing the hypothetical mid 30s couple having 60k each in their CPF OAs – this is basically poverty level as even an entry level 3k income over 10 years of work with no increments at all (extremely unlikely worst case scenario) would net you more than than 70k easily. In spite of that, this couple is still able to afford an apartment – who says HDBs are too expensive?

Personally feel that the 15 month wait will at least hamper price increases for the top end of resale HDBs. Might take a while for sellers to realign their expectations though, by which time ex-private property owners may be able to enter the market again.

Stacked Homes
Admin
1 year ago

Thanks for sharing your thoughts on this! Yes we were quite charitable in that sense but we wouldn’t really say it’s poverty level :O HDBs are affordable, just not those prime central ones that are pretty much in constant demand.

ysteh
ysteh
1 year ago

Hi Ryan, does HDB define when the 15mth wait-out starts counting, I.e. from the date OTP signed or date of OTP exercised or date of completion of the private property?

Stacked Homes
Admin
1 year ago
Reply to  ysteh

Hi, it’s based on the completion. We’ve updated the article accordingly. Thank you.

Miss Low
Miss Low
1 year ago

Does EC which have reached MOP last year considered as private property and will it be affected by this new cooling measures?

Stacked Homes
Admin
1 year ago
Reply to  Miss Low

Hey! It’s considered fully private only 10 years later, not 5. That’s when it can be sold to foreigners. However for this purpose, after 5 years, it’s still considered private property and is not affected by this ruling.

Sheeba
Sheeba
1 year ago
Reply to  Stacked Homes

After 5 years, if it’s considered private property, why is it not affected by this ruling?

Stacked Homes
Admin
1 year ago
Reply to  Sheeba

ECs are always considered private property, not just after 5 years. There were some confusion as to the phrasing of the sentence. If you are an EC owner selling, then you are affected if you buy a resale HDB. If you are private property owner looking to buy an EC that’s less than 10 years old, you are NOT affected because it’s a private property, not a resale HDB. This was the point we were trying to bring across as we received questions pertaining to the “buying an EC that’s less than 10 years old” portion, not as someone selling an EC. We hope this clarifies.

Chris
Chris
1 year ago
Reply to  Stacked Homes

I called HDB hotline to clarify this and the answer given is that an EC is considered private property and IS AFFECTED BY the 15 month wait out ruling. I have emailed them as well the and the response from HDB corresponds with the hotline answer.

Please do your own checks with the relevant authorities and update here officially.

Stacked Homes
Admin
1 year ago
Reply to  Chris

Hi Chris, we believe you have misunderstood the paragraph. The point here refers to buying an EC that hasn’t hit its 10-year mark, not selling one. We received enquiries on whether ECs that have not reached their 10-year mark cannot be purchased within 15 months since it is not fully privatised (meaning it cannot be sold to foreigners). It has nothing to do with selling your EC – since it’s a private property, you are affected by the 15-month ruling. However, we can see how our phrasing has caused more confusion than generating answers. As such, we removed the sentence completely since we could not find a way to phrase it that makes it very clear that if you are buying an EC less than 10 years old, then the 15-month wait out period does not affect you. We hope this clarifies the point above and that it has nothing to do with inaccuracies.

Sen
Sen
1 year ago

My crystal ball said that 1) HDB 5 room price will drop. Because of higher floor rate of MSR, TDSR. And lower LTV ratio. Private owners will think twice in moving to HDB unless they want a HDB 4 room. 2) Private property may increase in price. I would factor the 15 months wait out period + 3-5 months of sales completion rental in sales price. But with the MDR, TDSR, increasing interest rate, people may find financially challenging to move from HDB to Private.
So it may result in a stagnant state for HDB 5 room and private property sales.
Let’s see the Q4 housing transaction. Exciting.

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