Singapore announces new property cooling measures: Higher ABSD rates, tighter loan limits

SINGAPORE: The Government on Wednesday (Dec 15) announced a package of measures to cool the private residential and HDB resale markets.

The measures include raising Additional Buyer’s Stamp Duty (ABSD) rates, tightening the Total Debt Servicing Ratio (TDSR) threshold and lowering the Loan-to-Value (LTV) limit for loans from the Housing and Development Board (HDB), said the Ministry of Finance, the Ministry of National Development and the Monetary Authority of Singapore in a joint press release.

“The Government has been closely monitoring the property market for several quarters,” said the statement, which was released to the media just before 11.40pm. It added that the private residential and HDB resale markets have been buoyant, despite the economic impact of COVID-19.

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Source: CNA


The TDSR threshold will be tightened from 60 per cent to 55 per cent. This means new mortgages cannot cause borrowers’ total monthly loan repayments to exceed 55 per cent of monthly income.

The new threshold will apply to loans for the purchase of properties where the OTP is granted on or after Dec 16, and for mortgage equity withdrawal loan applications made on or after Dec 16.

Borrowers with existing property loans granted before Dec 16 will not be affected by the revised TDSR threshold when refinancing their loans, the authorities said.

Additionally, in a measure specific to public housing, the tightened LTV limit for HDB housing loans will now be cut from 90 per cent to 85 per cent. This reduces the maximum amount potential homeowners can borrow from HDB.