Sunday, March 16, 2014

Uncertainty about amount of loan to purchase a property

The new HDB rule proposed by Khaw Boon Wan is likely to cause the market to be more unstable.

It is better for HDB and the bank to tell in advance, what is the amount of loan that they are prepared to provide for a property, so that the buyer can sign the sales agreement without this uncertainty.

I can understand the difficulty for HDB to commit for a valuation price, when the property market is uncertain. But it is precisely the job of the government to give certainty and help to stabilize the market, rather than take the easy way out by avoiding responsibility.

HDB could say that they are prepared to grant a loan of $X for a specific property, without saying that this is the "valuation price". This can be set at a lower level, to discourage overspending.

Time and time again, I see the failure of the government to do its job, to give certainty and manage the situation. By abrogating its duty, it is causing chaos for the ordinary people.

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