How much should a person pay for a property? This is an important question. So far, there is no guide on this matter.
When property prices goes up, too many people spent too much money on buying a property thinking that it will go up forever. When the property prices reach a ridiculous level and falls from there, it can cause a lot of problem to the financial system.
I suggest that the limit should be:
> 7 years of the breadwinner's income
> 5 year of the combined family income
If one spouse is working with an annual income of $40,000, the limit should be $280,000. If both spouses are working with an annual income of $70,000, the limit should be $350,000.
In working out the guideline, I have taken into consideration the percentage of income that goes to service the housing loan, the repayment period of 30 years and the long term level of interest rate, and future increase in earnings.
I hope that this gudeline is useful for most people You should not exceed the limit. It is all right to buy a property below this limit.
- ► 2018 (1406)
- ► 2017 (1258)
- ► 2016 (828)
- ► 2015 (691)
- ► 2014 (144)
- ► 2013 (501)
- ► 2012 (1269)
- ► 2011 (1873)
- ► 2010 (2369)
- ► 2009 (1654)
11/02 - 11/09
- Has MAS responded to the 3 petitions?
- Proposed terms of settlement
- Saving the Financial Industry?
- A favourable impression of Tunis
- Impact of Obama's election on the future of Singap...
- Seminars on financial risks associated with financ...
- Minibond Saga in better explained form
- SCMP:Investor cool-off pondered
- SCMP: Democrats drop legal bid after deal on Lehma...
- Is mis-selling a market misconduct?
- The New Paper: Latest structured product scandal
- Business Times: Kudos to CIMB-GK and UOB-Kay Hian
- SCMP:Repairing the damage
- US Presidential Election 2008
- Advancing the best interest of our people
- Keep sadness and hatred to themselves
- Tunis, 5 to 8 November
- Dr Lan Luh Luh – your further clarification is req...
- SCMP: Regulators have let down investors badly
- 10,000 SACRIFICIAL LAMBS
- Market Discipline and Caveat Emptor
- Open Forum with OCBC Bank/Securities
- Should financial markets be more strongly regulate...
- MAS has the power to investigate and bring a court...
- Flaws in financial planning industry
- Presence of disclaimers in prospectus
- Indicate price of Pinnacle Notes as at 20-10-08
- Spain Lets Jobless Postpone Half of Mortgage Payme...
- Mis-selling of Lehman structured notes
- Million Dollar Round Table (MDRT)
- Clarification from Dr Lan Luh Luh
- Bank claims to be "order executor"
- Petitions on Structured Products
- Fortnightly Meetings at Speaker's Corner on Struct...
- Open Forum with UOB Kay Hian
- Send your views directly to MAS
- New swap counterparty to replace Lehman Brothers
- Adolf Hitller complains about the ERP and MRT
- Buy a property that you can afford
- How to manage a crisis
- NTUC Income is different today
- Upset investor share bad experience with bank
- How to track all comments on my blog
- Political ambitions?
- Intention to deceive?
- Key features of structured products
- Reply to "Risk listed in bold"
- Stolen identity
- Collective legal action - Leonard Loo
- Reply to SP Services: Don't shoot the messenger
- ▼ 11/02 - 11/09 (50)
- ► 2007 (1803)
- ► 2006 (696)
- ► 2005 (159)