Press here to Skip to the main content
Font Size
Default Font Size Larger Font Size Largest Font Size RSS Subscription Advanced Search Sitemap Mobile/Accessible Version 繁體 简体

Property cooling measures unveiled

February 27, 2015

Monetary Authority Chief Executive Norman Chan today announced new measures to cool the property market.

 

It will lower the maximum loan-to-value ratio for self-use residential properties valued below $7 million to 60%.

 

The maximum debt-servicing ratio (DSR) for borrowers who buy a second residential property for self-use will also be lowered to 40%, and the stressed-DSR cap will be lowered to 50%.

 

For non-self use properties, including residential, commercial and industrial properties, and car park spaces, the maximum DSR of mortgage loans will be lowered to 40% and the stressed-DSR cap will be lowered to 50%.

 

Mr Chan told the media the new measures will inevitably affect first-time homebuyers but it is the authority’s duty to ensure banking and financial system stability.

 

The Mortgage Corporation also announced the maximum Mortgage Insurance Programme (MIP) cover for eligible properties will be reduced from the 90% loan-to-value (LTV) ratio to 80%, except for regular salaried first time homebuyers with a maximum debt-to-income ratio of 45%.

 

These people can still be eligible for the maximum MIP cover of 90% LTV, it said.

 

The measures take immediate effect, but will not apply to transactions with provisional sale and purchase agreements executed today or earlier.



Top
The Budget