http://www.straitstimes.com/Breaking...ry_607186.html
Nov 25, 2010
MAS YEARLY FINANCIAL STABILITY REVIEW
Property prices may go up
SINGAPORE'S central bank said low borrowing costs and excess liquidity globally may push the island's property prices higher again, setting back government efforts to cool the market, reported Bloomberg news.
There is a risk that financial institutions may ease lending standards and extend more loans to make up for narrowing interest margins, the Monetary Authority of Singapore said in its Financial Stability Review on Thursday.
Buyers may also take on 'excessive leverage' amid expectations of a sustained period of low rates, the central bank said.
The government in August increased down payments for second mortgages and imposed a stamp duty on property held for less than three years to curb speculation.
After leading 36 markets around the world in property-value changes in the second quarter in a Global Property Guide survey, government statistics showed price gains slowed in the three months to the end of September.
'There is a possibility that transaction activity and prices could pick up again given the current global conditions of flush liquidity and low interest rates,' said MAS.
'The government will continue to be vigilant in monitoring developments in the property market, and if necessary, adopt additional measures to promote a sustainable property market.'
Private residential prices rose 2.9 per cent in the third quarter from the previous three months, when they climbed 5.3 per cent, according to Urban Redevelopment Authority. Singapore's government forecasts economic growth of 15 per cent this year and expansion of 4 percent to 6 per cent in 2011.