Your search results

What Might Occur If We Ease Property Cooling Measures?

Posted by Jayson Ang on July 21, 2025

| 0

TLDR

To assess if Singapore’s property cooling measures are working, compare our actions with China, which is applying the opposite strategy by trying to revive its real estate sector. China recently cut mortgage rates and raised the maximum loan-to-value (LTV) ratio, while Singapore tightened borrowing criteria and reduced LTVs. If China’s moves spark a rebound in prices, it suggests Singapore’s cooling measures might be effective at dampening demand. Watch China’s results closely, especially since changes in Chinese policy and buyer interest can impact Singapore’s luxury market (CCR). With higher ABSD for foreigners and easier conditions in China, fewer Chinese buyers may enter Singapore’s market in the near future. Whether you should buy, sell, or wait depends on your unique circumstances—there’s no one-size-fits-all answer, but data-driven advice and careful planning are more important than ever.

At times, an effective method to assess cooling measures is to observe those who are taking contrary actions.

How can we determine if the cooling measures in Singapore are effective? The most straightforward approach is to evaluate the outcomes after a few months. However, there’s another unconventional method: examining countries that are addressing the opposite issue (specifically, revitalising a struggling real-estate sector) and assessing whether their strategies differ significantly from ours. Currently, China serves as the most relevant case study for this.

China’s property market has been in crisis since 2021 (although some analysts might contend that it began a year earlier with the introduction of the three red lines policy). Nonetheless, the property giant Evergrande Group faced severe financial difficulties and failed to meet its debt obligations. When it defaulted on an offshore bond in December 2021, it triggered a cascade of events: Evergrande alone owed an estimated US$310 billion that could not be covered. Other real estate firms, such as Fantasia Holdings and Sinic Holdings Group, soon followed suit, leading to a prolonged downturn in China’s real estate market.

Recently, China has launched a substantial aid package for its property market, which stands in stark contrast to our cooling measures.

China has reduced mortgage interest rates by an average of 0.5 per cent for individual borrowers. Additionally, the maximum Loan To Value (LTV) ratio for home loans has been increased to 85 per cent, up from the previous 75 per cent.

This stands in stark contrast to the situation in Singapore. While our government has not raised interest rates, we have increased the floor rate for Total Debt Servicing Ratio (TDSR) and Mortgage Servicing Ratio (MSR) calculations, making it more difficult for borrowers to qualify. Furthermore, we lowered the LTV for home loans to 75 per cent, including for HDB loans, back in August 2024.

If our cooling measures have effectively moderated prices, then the reverse should potentially boost prices – it will be intriguing to see the extent of this effect on the Chinese market.

For instance, how might a 0.5 per cent reduction in interest rates influence prices? This is particularly relevant for Singapore, as a significant rate cut in the US could also lead to lower mortgage rates here. The last time we experienced this was during 2018/9 and Covid, when lower interest rates substantially increased real estate prices. Our recent research indicates that from 2000 to 2024, interest rates were pivotal in driving up even resale flat prices. A 0.5 per cent interest rate reduction in China might provide valuable insights into its impact on prices today.

In terms of decreasing LTV ratios, observing its potential to revitalise the Chinese real estate market will also be of interest to us. If it shows little to no effect, we might anticipate a similarly modest impact from our latest cooling measures. This presents an opportunity to study how much leverage is necessary before real estate begins attracting new investors (and vice versa).

Next, we need to consider the additional impacts on our Core Central Region (CCR).

Those owning luxury CCR properties should be particularly vigilant regarding developments in China at this time. Chinese purchasers continue to represent a substantial portion of buyers in the CCR, as was evident in 2022 when they dominated the market for local luxury real estate.

Currently, Singapore imposes a 60 per cent ABSD on foreign buyers, while simultaneously, the Chinese government is relaxing mortgage regulations. This creates a significant incentive for Chinese investors to reconsider purchasing in Singapore and focus on opportunities back home.

The interplay between ABSD and the actions of China’s central bank may influence CCR property values in the near future, unless Singaporeans swiftly step in to fill the void—though this seems unlikely, as even many potential upgrader buyers find CCR condos financially unattainable today.

Should You Buy, Sell or Wait?

If you’re reading this, you must be trying to figure out the best course of action right now: is it the right time to buy or sell?

It’s difficult to give an exact answer since everyone’s situation is unique and what works for one person may not necessarily work for you.

I can bring you a wealth of on-the-ground experience and a data-driven approach to provide clarity and direction. From beginners to experienced investors, our top-down, objective approach will help you on your real estate journey.

I can help you by:

Offering Strategic Real Estate Advice – I can help create a comprehensive plan to guide you through your property journey.
Connecting Your Home with the Perfect Buyers – Through stunning visuals, an effective communication strategy, and an in-depth knowledge of the market, we’ll ensure your home is presented in the best possible way to fulfill your goals.

You May Also Like …

Mandarin Top 5

The Importance of Due Diligence in Property Investing in Singapore

Jayson Ang – April 22, 2024 –

Investing in property can be a lucrative venture, but it also comes with its own set of risks and challenges....

All Blog Posts Opinion

Are We Truly Headed For A Slowdown? How Will This Affect Property Prices?

Jayson Ang – December 9, 2022 –

TLDR The pandemic-induced recession has surprisingly boosted property prices in Singapore, defying conventional economic trends. Factors like cost-push inflation, limited...

All Opinion

What You Need to Know About Residential En Bloc Sales in 2025

Jayson Ang – October 28, 2025 –

TLDR En bloc sales in Singapore involve selling entire buildings to developers for redevelopment, with most owners needing to agree....

All Buying Tips Opinion

Leasehold vs. Freehold Condos in Singapore: A Decade of Data

Jayson Ang – December 14, 2025 –

TLDR In Singapore’s property market (2014-2024), leasehold condos often outperform freehold in short-term holding (around 10 years) due to lower...

All Buying Tips Opinion

7 Frequently Overlooked Questions That New Condo Buyers Should Ask At The Showflat To Avoid Any Regrets In The Future!

Jayson Ang – January 29, 2024 –

TLDR Newly launched condominium buyers face uncertainties about price changes, proximity to schools, construction methods, maintenance costs, elevator availability, commercial...

All Blog Posts Opinion

Invest During the Bearish & Exit During the Bullish

Jayson Ang – December 27, 2022 –

TLDR A comprehensive overview of the real estate market trends, emphasizing the importance of strategic property analysis and investment decisions....

Mandarin Top 5

Discover the Best Breakfast in Singapore: Top 5 Must-Try Spots!

Jayson Ang – February 28, 2024 –

Trying out some of the best breakfast places, I've put together a list of the top 5 must-try breakfast spots...

All Buying Tips

Your Key to a Happy Retirement in Your HDB? Let’s Unveil The Mystery Behind the Lease Buyback Scheme!

Jayson Ang – March 30, 2024 –

TLDR The Lease Buyback Scheme (LBS) is gaining traction among older Singaporeans looking to boost their retirement income by selling...

All Opinion

Unseen Dangers of Putting Your Money in Upscale Freehold Properties in Singapore

Jayson Ang – February 17, 2024 –

TLDR Luxury freehold properties in Singapore may not always be the lucrative investment opportunities they appear to be. High-end properties...

All Buying Tips

Want To Buy A Property? Read Me First!

Jayson Ang – December 7, 2022 –

TLDR Understanding the key factors involved in buying property in Singapore is crucial for making informed decisions. Consider your investment...

All Buying Tips Opinion

The New Condo Rule: How GFA Harmonization Makes New Launches “Pricier” and What It Means for Buyers

Jayson Ang – May 30, 2026 –

TLDR GFA Harmonization standardizes Gross Floor Area measurements across Singapore government agencies, removing non-usable spaces like oversized planter boxes, air-con...

Mandarin Top 5

Top 5 : Greatest Challenges That Investors Face In Singapore’s Real Estate Market

Jayson Ang – December 23, 2024 –

Singapore's real estate market is a dynamic and attractive investment landscape for both local and international investors. Known for its...

All Buying Tips Opinion

5 Unexpected Factors That Make Some New Launch Condos Sell Like Hotcakes

Jayson Ang – August 9, 2024 –

TLDR The Singapore property market for new condo launches in 2023 saw varying degrees of success. Factors like limited competition,...

All Blog Posts Opinion

Where to Find the Most Affordable New Launches in 2023 – Starting at $1.31 Million

Jayson Ang – January 24, 2023 –

TLDR When looking for an affordable new launch condo in Singapore as of January 2023, consider projects like 10 Evelyn,...

All Buying Tips Opinion

Most Buyers Miss This Condo Checklist Item — Until It’s Too Late

Jayson Ang – April 18, 2026 –

TLDR When buying a condo, many overlook the importance of the Management Corporation Strata Title (MCST) and its finances. Beyond...

All Buying Tips Opinion Selling Tips

Singapore’s Property Jungle: A Guide to Every Development Type

Jayson Ang – October 12, 2025 –

TLDR Singapore’s real estate market features a diverse mix of property types—public HDB flats, executive condominiums, private condos, landed homes...