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Singapore buyers deserting London as loan rules stifle borrowing

[LONDON] Singapore investors are buying fewer mansions in London after mortgage changes in the island nation limit their ability to borrow.

The number of Singaporean's buying prime homes in the capital fell 74 per cent in the period from November to the end of May compared with the previous six months, according to broker Knight Frank LLP. They now make up 1.7 per cent of all buyers in the city's best districts, down from 3.8 per cent in the prior period, the broker said.

Homebuying from "Singapore is very low at the moment and falling off," Rob Perrins, managing director of Berkeley Group Holdings, said in an interview June 17. Investors from the city state were the biggest overseas buyers of new homes constructed by Berkeley, London's largest homebuilder, in 2013, Mr Perrins said.

Singapore's government capped borrowers' total debt repayments at 60 per cent of monthly income in June 2013 as it sought to prevent a property bubble in Asia's second-most expensive housing market. That made it harder to purchase homes overseas as international borrowings are included in the cap.