Mortgage applications at OCBC bank fell 20 percent in January, though it is still unclear how much the latest property measures have affected demand, the tighter home ownership rules and financing have curbed demand for new mortgage loans, especially for cheaper properties.
“The speculative interest has pretty much been taken out of the market; that we can clearly see when we talk to our business partners,” said Ching Wei Hong, Head of Global Consumer Financial Services at OCBC.
He said the number of mortgage applications for new homes dropped 20 percent in January, compared to December.
However, “it’s a little hard to say at present" what the full impact of the latest property measures are, because the monthly loan applications were also affected by seasonal factors, said David Conner, Chief Executive at OCBC. “Coming into Chinese New Year, you wouldn’t expect a whole lot of business.”
Mortgage loans at OCBC expanded 4.5 percent to S$27.1 billion over the fourth quarter, out of which S$21 billion were Singapore home loans, said Mr. Ching.
Mr. Conner noted that OCBC’s mortgage portfolio is unlikely to shrink, despite the most recent property measures. “We have a lot of loans that were booked over the last 12 to 18 months that are being progressively drawn down, so we don’t expect the loan book to shrink; it should continue to grow.”