Property Hunter Magazine Property Hunter Magazine Issue 52 - March 2014 | Seite 111

OCBC Bank Now Offers Singapore Property
Financing in Ringgit

EXPOSED! ‘Investor Clubs’ Behind
Sky-Rocketing Property Prices but
No Action From the Authorities
Chang said property gurus
openly advertised, even
showing off who “their”
developers are.
“They say they ‘front for them
(developers)’ which means the
clubs already have deals with
the developers,” he told SunBiz.
“Such clubs have been
mushrooming in the housing
industry, manipulating prices by
representing an average of 100
to 200 purchasers, even up to
500 buyers.

Chang Kim Loong
OCBC Bank (Malaysia) Bhd (OCBC
Bank) is expanding its ringgit loan
facility for residential properties in
Singapore in line with its positioning as
a global premier mortgage provider for
overseas properties.
OCBC Bank already offers overseas
financing in two other major countries,
Australia and United Kingdom, and the
Singapore financing facility is expected
to be similarly well received by the
Bank’s premier banking customers.
According to Charles Sik, head of
consumer financial services, OCBC
Bank, the introduction of the “OCBC
Overseas Property Financing –
Singapore” is a natural progression of
the facility since Asian investors have
always had an eye for Singapore.
“Singapore is a global city and a natural
‘magnet’ for investors. According to
research, the country has always
been one of the top three choices for
investors from Malaysia, Indonesia and
Hong Kong.
“We view this finding as fundamental
to our decision to offer the OCBC
Overseas Property Financing –
Singapore scheme.
“I am happy to include that our
Australia and London property loan
schemes, launched in recent years,
were popular and did well to meet the
demands of our customers,” he said.
With the OCBC Overseas Property
Financing schemes, customers can
now easily take advantage of the
ringgit-based loans, hence mitigating
the effects of fluctuating foreign
exchange risks.

“Some even dominate 50% of
housing units and commercial
development.”

OCBC Bank currency economist
Emmanuel Ng said OCBC has an
end-2014 Singapore dollar to ringgit
forecast of around 2.6365. “Moving
ahead, the currency universe may be
preoccupied with the prospect of the
US Federal Reserve tapering and we
think this may grant inherent support
to the broad dollar in the coming year.

Investor clubs are buying
new houses en-block from
developers, leading to the
sky-rocketing of house
prices. Comprising groups of
individuals, they are usually led
by self-proclaimed property
gurus who use their numbers
to secure huge discounts from
developers.

“To this end, we would expect the
Singapore dollar to marginally
outperform the ringgit in this
landscape and would expect the
Singapore dollar to ringgit to trade
in the upper half of a 2.5500-2.6500
band by the end of 2014,” he said.

National House Buyers
Association (HBA) secretarygeneral Chang Kim Loong
claims some even get discounts
as high as 25% on purchase
prices.

Developers, for example, fall in
with the plan in order to drawdown on bridging loans from
banks, where, in most cases,
they will only be allowed once
50% of the project is taken up.

This has resulted in developers
passing on the “losses”
sustained in those purchases
to the average buyer in
subsequent phases of the
project to compensate for
the reduced profits in the first
phase.

“So here, they’ve got these
purchasers who say they will
buy en bloc, up to 50% or
60% of the units with a certain
discount.

According to DTZ Research, via their
Property Times Singapore Q1 2013
report, property prices in Singapore
are expected to remain resilient
despite the cooling measures being
introduced by regulators.
Barring further government measures
and with interest rates still remaining
low, purchase demand is expected to
be sustained, especially from the firsttime buyers unaffected by the cooling
measures.
Prices of new projects are expected to
hold up, especially for those that are
well-located, such as near transport
hubs and amenities.
The OCBC Overseas Property
Financing – Singapore facility offers a
margin of financing of up to 70% and
a loan tenure of up to 35 years or up
to the time the borrower turns 70,
whichever is earlier.

Chang said that to his
knowledge, there are at least
seven such clubs in the Klang
Valley. The HBA wants the
authorities to investigate the
growing number of such clubs
in the Klang Valley area.
As at press time, REHDA had
not responded to SunBiz’s
queries while the Minister of
Housing and Local Government
did not respond to calls for
comment.

“The modus operandi of the
operators of these clubs is to
negotiate as a block purchaser
with c