By Mr. Propwise

The MAS announcement on October 5, 2012 of the new restrictions on mortgages has been well covered by the media. In this article I will focus more on my thoughts on the impact of these measures on the market, and also present some concrete illustrations of how these measures will impact different groups of buyers in the market.

A quick recap of the measures

From October 6, 2012:

1. All residential property loans will be limited to a maximum tenure of 35 years.

2. The Loan-to-Valuation (LTV) for mortgages will be lowered to 40% (for borrowers with one or more mortgages) or 60% (for borrowers with no outstanding mortgages) if the loan tenure is greater than 30 years OR the loan period extends beyond 65 years of the borrower’s age.

3. LTV for mortgages to non-individual borrowers will be lowered from 50% to 40%

The thinking behind ...