Will PROPERTY STOCK DROP TOMORROWWWWWWWWWWW???????????
Written by Joseph Chin
Wednesday, 03 November 2010 17:33
KUALA LUMPUR: Bank Negara Malaysia is imposing with immediate effect the maximum loan-to-value (LTV) ratio of 70% for the third house financing facility taken by a borrower as it seeks to curb "excessive investment and speculative activity in the residential property market".
The central bank said on Wednesday, Nov 3 the move was expected to moderate the excessive investment and speculative activity in the residential property market which has resulted in higher than average price increases in such locations.
“This has also led to increases in house prices in surrounding locations, thus contributing to the declining overall affordability of homes for genuine house buyers," it said.
Bank Negara said the financing facilities for purchase of the first and second homes are not affected and borrowers will continue to be able to obtain financing for these purchases at the present prevailing LTV level applied by individual banks based on their internal credit policies.
“The measure aims to support a stable and sustainable property market, and promote the continued affordability of homes for the general public,” it said.