Residential

Tharman: Home prices not corrected enough yet

While HDB resale prices and private property prices have been adjusting in the last four to five quarters, Deputy Prime Minister and Finance Minister TharmanShanmugaratnam said that the price correction mechanism is still working to reverse the effects of the sharp increase in property prices in the past years. He said that if property prices are left unchecked, they would have increased in excess of household incomes. Nonetheless, Minister Tharman said that the risk profiles of borrowers have improved as the share of borrowers taking up multiple housing loans have fallen to 13 percent of new housing loans in Q2 this year, as compared to the 30 percent in 2011. The average tenure of new private housing loans has also declined to about 25 years, instead of 30 years in 2012. According to the Urban Redevelopment Authority, private property prices have decreased ...