AGREED. At times, I do reflect myself being in the moderate-income frame. How are they going to afford a property with hiked up price nowadays.

as i say different family different circumstances lar. some will agree, some wont. plus i dun think this is a long term implementation, once the property market cool down the LTv will be back to 90%. can you imagine this restriction still applies during a recession?? looks impossible to me.

Just imagine if u were like that young fler who owns 2 sub 200k props now & is trying to buy himself a 400k landed prop. He would have to dig into his pocket for 120k as d/p, wouldn't this be unnecessary hardship with the 70pc LTV??

Yes, but I'm trying to put myself in the shoes of an moderate earner who is slogging to meet then ends in daily life and how will they worry on getting a roof over their head with the current property prices???

If that young guy can afford to hold on to TWO properties - I feel going for an THIRD is on personal choice and doesn't require an interference or consideration from the Government or any agencies. My concern will will be on the FIRST purchaser for that group are the MOST affected from the Property Price Hike.

Does that mean if you sell off your any of your 1st two properties, then you wouldn't be bounded by the LTV 70% cap?

Anyone in the know?

This post has been edited by mageP23: Nov 4 2010, 02:09 AM

U're right again. Giving credit to your 1st time purchaser who has to scrape by to make ends meet, the govt has made provisions for 100pc loan for purchases below 220k. But there's also this group who wants to move up beyond 1st or 2nd purchase to a decent landed prop which needs to be addressed. I would think that clearer guidelines should have drawn for this group to move up the property ladder without unnecessary burdensome caps on loans. Yet clearer statistics should have been drawn of the makeup of this group of buyers who are interested in props below 220k instead of a blanket call for an LTV cap. I would actually think it's more political than purely driven by market considerations. But i do concede to your thoughtful points. Thank u for the meaningful discussion.

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Added on November 4, 2010, 2:11 amThat's where it was ambivalent, it mentioned 'property' not 'loans'. I think more will be revealed ahead. Let's bide our time.

This post has been edited by Daryl Teo: Nov 4 2010, 02:15 AM

I am thinking about that too, is like having the cheaper property sell off and look for the LTV 90% for more expensive property...But from the statement, is should be this way though..

Need someone to confirm it

I am not sure if the developer will give up to 20% discount. Not sure if that is allowed.

From my experience, for second hand property, bank will not issue you the loan just based on the selling price as per S&P. Bank will need to send a valuer to assess the value of the property and will be basing on that cap when offer loan to you.

Use close family members name is a way, but remember they need to have income. If they don't have sufficient income, they will not qualify to get a loan at all. And if they have income, remember to minus their other commitments like car loan and other instalments.

to be honest, if the property is hold by many foreign investors and push the price up, the property market is healthier.... just the locals need to compete with the price those foreigners have.

One question here.

Can I still apply loan @ 90% if I purchase my third house with my wife? For the 1st and 2nd house, I already purchase using my name only for the loan.

Any comment?

don't over do with property market. 1997 we already faced it once and it bleed me dry, really dry. ppl rich like USA (and the house is cheap there...well, NYC is an exception though) also get hit.

property market is so tempting but somehow, it is the root cause of many people become "tied crab" as we are paying the morgage usually in long term.

just my opinion.

I think it's depending on the number of properties you bought, if the intention of BNM is to curb over-speculation.

why would young high achiever have problem putting 30% down on a 400k property? maybe our definition of high achiever is different.

Good move at the right time by BNM. Some sort of signal was needed to stop property sector from overheating.

I would think that most regular people will in their whole life only buy 1 or 2 properties, so they won't be affected.

High achievers probably hav high income figure to qualify for loans.. but maybe not enough capital or savings for downpayment!!

*not all high income earners have high savings..

This post has been edited by eugene jk: Nov 4 2010, 10:28 AM

very good exchange of ideas both of you had going.
would like to add my 2 cents worth:
1. fully agreed with your scenario for i believe i'm in quite an exact position as what you have proclaimed. for the late twenties to the 30's group, they are indeed looking for a upgrade to their unit. i fully concur if the ruling were meant from 4th property/loan onwards. that will make much more sense IMHO.
2. they are too many uncertainties by way the announcement was made. BNM have declared with immediate effect but my guess is the following questions will not be answerable by the bank. eg:
a) if the purchase is under joint name where one of them is purchasing their say 5th unit and the other party is into their 2nd unit. how much margin can they get? 90% or 70%?
b) as most forummers have mentioned, is it property based, or loan based?
c) irrespective of loans or properties, what if the buyer have settled or disposed of their loans/properties? should the ruling be for 'active' loans or ownership of properties only be more sensible?
d) they are some other multiple cases such as names appearing in SPA only but not loans. and some appearing in SPA and loans but not servicing the loan. and etc. how does that take into account the person's eligibility?

now this is purely my thoughts; i am foreseeing no drastic drop in prices, more creative financing packages by developers and banks, BUT increase in rental prices. don't ask me why. just a hunch. so if that materialise, it will not actually help 1st time buyers but actually makes the escalate the property bubble lah. property price already high, rental increase to become high also. BOOM!

am surprised brother Pai have not spoken yet!

For a couple: husband & wife they can have 4 properties between them. Still reasonable....

if the wife or husband is working has enough income to service the loan

more clarifications needs to be set out by BNM before we can assume a couple can have 4 props between them. i.e. if the couple has 2 props on a joint loan account, would they have met the threshold of 2 props already or its considered 0.5 + 0.5 = 1 per pax?

also, like wat many forumners have pointed out above - what if the husband has say...3 houses under his name but the wife only has 1? well, one may argue that the couple can just buy the prop and take the loan under the wife's name...but more often than not, u need the power of 2 incomes to meet the bank's loan eligibity criteria. as of now, everyone is still in the dark on how would the LTV be calculated...just hope the further details to be issued by BNM would be intended to cool the prop market instead of being punitive in nature.

Still need clarify whether this 3rd means 3rd property or 3rd financial loan on hand. If is the latter, will it affect sub sale market as owners force to sell cheap and fast to free up for buying new developments?