By Paul Ho (guest contributor)
Under the HDB’s new rules issued on 27th Aug 2013 and effective on 28th Aug 2013, Singapore Permanent residents will need to wait three years before they can purchase a HDB flat. This is welcome news for most young Singaporean couples as less competition will mean more stable prices, but the specifics of the rules can create an anomalous situation where a young couple finds they cannot finance an HDB flat but are able to finance a private condominium.
HDB’s Monthly Servicing Ratio capped at 30% and loan tenure at 25 years
In line with the government’s aim to impose financial prudence, the monthly servicing ratio (MSR) for HDB flats has been set at 30%. This means that the housing related servicing must not exceed 30% of a person’s or household’s gross income. For example, a household who earns $8,000 a month (husband ...
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