Real concerns ahead? - StarProperty.my
THE surge in property prices has created a fresh avenue for investors wanting to make big bucks, but it is also creating a huge future problem that if left unchecked, can spell trouble for households, banks and the overall economy.
Housing loan repayment periods have gone from 30 years to up to 40 years, and home buyers can now take loans up to the age of 70, way past their retirement age.
Also, the innovative loan schemes that require smaller downpayments – 5% or even zero payment – has allowed buyers to make huge returns.
To address this, maybe Bank Negara, taking a cue from what China has done, will need to look at instituting more stringent requirements for housing loans.
One suggestion is to impose higher downpayments, based on percentages on a rising scale, for people buying second, third or more houses.