A new way of reining in property price increases?

HEATED land sales have prompted Singapore's central bank to scrutinise bank financing for property development more closely through a new survey of banks last month. The Monetary Authority of Singapore (MAS) is said to have sought information from banks on their exposures and details of loan facilities granted for each project, such as key covenants and loan-to-value (LTV) ratios.

While it is not unusual for the MAS to collect data from banks to monitor their lending practices from time to time, this survey has set some market watchers pondering whether it may be a precursor to a new cooling measure.

If the government decides to tighten the screws on development loans to take the steam out of land prices, that would indeed spell bad news for developers.