The latest property measures implemented by the government have affected the demand for new loans at the lower end of the market but not at the high end, said Piyush Gupta, Chief Executive of DBS Group.
Mr. Gupta said it is still “too early” to predict how much impact the latest measures will have on demand for mortgages.
“There’s been a slowdown but the slowdown also happened because of the Lunar New Year; that happens every year. So it’s difficult for us to understand, so far, how much is the impact of the January guidelines and how much is the impact of the seasonality of the Lunar New Year.”
However, the number of new mortgage applications has dropped since August last year, he said.
“Our own general sense is that volumes will come off. We think these measures will have some impact.”
But so far, the property measures have had a greater impact on loan applications for low-end properties. “Our observation after the August guidelines is that the top end of the market came off for a month or two and then bounced back. The lower end of the market ̶ the smaller-value properties ̶ came off and stayed off.”
“There’s still a lot of liquidity and demand at the top end,” he said.
That was both an advantage and disadvantage for DBS, said Mr. Gupta. “Our presence in the lower end of the market is much stronger than in the top end. So when you have a slowdown at the lower end, it hurts DBS.”