The numbers show that the effect of the property cooling measures are largely transitory – at least on the luxurious homes in Sentosa Cove for this year. Based on caveats lodged with URA, we found that sales volumes and prices are negatively impacted only in the month right after the implementation of the measures. Things return to its former exuberance after that. The 7th round of measures implemented on 12 January saw ABSD rates and minimum cash downpayment upping along with a tightening of LTV ratio. The regulatory changes particularly affected investors buying a second or subsequent home, as well as foreigners and PRs. Landed homes in Sentosa Cove are highly sought-after by non-Singaporeans as this is the only area in the country where they can acquire a landed home or a Good Class Bungalow (GCB) – with effect from 17 October 2012, PRs are barred from purchasing a GCB in the mainland although they are still allowed to acquire landed housing there. Thus this could probably partly explain the brisk demand for housing on Sentosa Cove. (But this is beyond the scope of this article). In February straight after the 7th cooling round, sale volume fell to a low level of 2 transactions. Likewise, absolute price and per square foot price halved from around $11.4 million and $4,927 psf, respectively, to $5.7 million and $2,449 psf. In April the abysmal figures were repeated. But not again until July – the month after the implementation of the TDSR framework. On 29 June, MAS mandated that all MAS-regulated financial institutions have to check that borrowers' total monthly debt obligations including existing property loans, must not exceed 60% of their income, before they can take another mortgage or refinance one. In July the number of transactions held steady at 5, but the mean prices have plunged to an all-time low for the year at $3.4 million and $1,836 psf. Developers were probably offering discounts to entice buyers after the tighter measures. In Table 2, we present the numbers for the first nine months of the year. Nevertheless the numbers for September are not finalised as buyers may lodge a caveat several weeks after purchasing a unit – or even months.

Table 1: Monthly Home Prices in Sentosa Cove in 2013

Source: URA

Table 2: Home Prices in Sentosa Cove Jan - Sep 2013

Source: URA Potential home loan borrowers, to find out how to get your home loan, you can check with the mortgage specialist at iCompareLoan.com - they don't even charge you!

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