Apparently, an unnamed employee of CIMB said that they are no longer offering financing for shoe box units, even for high credit rating clients. The reasons given are extremely high prices per square foot as compared to more reasonably sized units. Another reason given is that the buyers of these units tend to investors rather than owner occupiers, which means that default rates will probably be higher if there is an economic downturn. I wonder if other banks may follow suit? So far though, the local banks have not said anything......According to PropertyGuru, at least one bank in Singapore is declining all loan applications for properties under 500sf in size, which are termed shoe box units in Singapore. The property market sentiment is generally poor now and banks are keeping a tight rein on financing. This also comes on the back of poor stock market sentiment which is in part caused by the Greece crisis and slowdown of the China and US economy.
Apparently, an unnamed employee of CIMB said that they are no longer offering financing for shoe box units, even for high credit rating clients. The reasons given are extremely high prices per square foot as compared to more reasonably sized units. Another reason given is that the buyers of these units tend to investors rather than owner occupiers, which means that default rates will probably be higher if there is an economic downturn. I wonder if other banks may follow suit? So far though, the local banks have not said anything......
Apparently, an unnamed employee of CIMB said that they are no longer offering financing for shoe box units, even for high credit rating clients. The reasons given are extremely high prices per square foot as compared to more reasonably sized units. Another reason given is that the buyers of these units tend to investors rather than owner occupiers, which means that default rates will probably be higher if there is an economic downturn. I wonder if other banks may follow suit? So far though, the local banks have not said anything......
