Property cooling measures on homes are likely to stay for some time as demand in the market remains “very resilient”, National Development Minister Lawrence Wong has said.

 

This has put an end to any speculation and expectations that the cooling measures will be lifted.

 

Mr Wong, who is also Second Finance Minister, said in a Bloomberg Television interview yesterday that the curbs “have helped to achieve a soft landing in the property market”.

 

“If you look at the market today, demand remains very resilient,” he added.

Private residential prices in Singapore fell 3 per cent last year.

 

But home sales topped those in 2015 as a third straight year of price declines stoked pent-up demand from home buyers.

 

Some of the curbs have been in place since 2009.

 

They include capping debt repayments at 60 per cent of a borrower’s income, as well as the Additional Buyer’s Stamp Duty.

 

This year’s Budget includes bigger Central Provident Fund housing grants for HDB resale flats, which is likely to sustain the increase in resale volume. Resale volume rose 7.8 per cent last year, compared with 2015.

 

This means that the resale price index, which has remained flat since the third quarter of 2015, will certainly stabilise or perhaps rise slightly with increased demand and higher resale volume.

 

A healthy Housing Board resale market with stable prices could encourage those aspiring to upgrade to private homes and lift the demand for them.

 

The Government is probably reluctant to pull back on the curbs because there remain the risks that doing so will overheat the market again.

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