Mortgage rates nearly double in six months

Median mortgage rates in Singapore have roughly doubled over the span of six months, amidst rising global interest rates that serve as a counter to inflation.

While the tightening of Singapore’s monetary policy in April would help bolster the impact of import on inflation, such that interest rates in Singapore would rise at a slower pace, the effects of United States Federal Reserve’s steepest interest rate hike in more than two decades are expected to bring about a spillover effect on Singapore’s mortgage rates.

The median rate for a fixed two-year mortgage across Singapore banks has increased from 1.15% in December to 2.25% in May, according to Redbrick Mortgage Advisory.

A three-year fixed mortgage saw a surge in interest rate from 1.15% to 2.5%, within the same timeframe.

Floating interest rates aligned with benchmarks such as the Singapore Overnight Rate Average (SORA), have also gone up, noted Redbrick Mortgage Advisory.

With the incline of interest rates set to persist, having adequate savings, coupled with regular reviews of existing mortgage plans and assessments of loan packages, is of fundamental importance for homeowners.

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