Singapore Home Prices Post Longest Losing Streak in 5 Years

ALL content used in this not-for-profit blog remain the property of their respective owners.
http://www.bloomberg.com/news/2014-07-01/singapore-home-prices-slide-for-third-quarter-on-property-curbs.html

Singapore’s second-quarter home prices slid for a third consecutive quarter, the longest losing streak in five years, as tighter mortgage measures cooled demand in Asia’s second-most expensive housing market.

An index tracking private residential prices fell 1.1 percent to 209.3 points in the three months ended June 30, following a 1.3 percent decline in the previous three-month period, according to preliminary data released by the Urban Redevelopment Authority today.

In addition to previous measures including new taxes and higher down-payments, Singapore announced rules in June last year governing how financial institutions extend property loans to individuals.

These steps were part of a government campaign that started in 2009 to rein in speculation in the Southeast Asian city.

Under the new loan framework, mortgages shouldn’t push a borrower’s total debt-servicing ratio above 60 percent and those that do will be considered imprudent, the Monetary Authority of Singapore said in June 2013.

Mortgage loan growth at 7.6 percent in May was the second-slowest pace since June 2007, data compiled by Bloomberg based on MAS figures showed.

“Prices this year could decline by between 5 percent and 8 percent,” said Donald Han, managing director of Chesterton Singapore Pte, a real estate consulting company.

Singapore could lose its competitive edge as an investment destination unless the government reviews its property cooling measures, the Straits Times newspaper reported, citing Kwek Leng Beng, executive chairman at City Developments Ltd., the country’s second-largest developer.