HDB to start tapering off construction programme from 2014

[dtrax]

SINGAPORE: National Development Minister Khaw Boon Wan said the Housing Development Board (HDB) will start tapering off the massive construction programme from 2014.

In a blog post published on Monday evening, Mr Khaw said three years of sustained ramp-up have begun to "restore the balance in our housing market".

However, Mr Khaw said the tapering will be done in a "measured" way to allow the market to gradually adjust, just like the government had done to cool the property market earlier.

Mr Khaw noted in his blog that as the November Build-to-Order (BTO) and Sale of Balance Flats (SBF) launch - the last exercise for the year, draws to a close tonight, the average BTO application rate has fallen from a high of 5.3 in 2010, to a low of 2.9 this year.

The November exercise saw 8,952 flats in a single launch, making it the largest in HDB's history.

Mr Khaw said with this, HDB has delivered over 25,000 BTO flats this year and over 77,000 BTO flats in the last three years.

The Cash-over-Valuation (COV) in the resale HDB market has also been falling in recent months, a trend which Mr Khaw welcomes as "symptomatic" that the supply and demand for public housing is returning to balance.

Mr Khaw said HDB has cleared the backlog of young families buying their first flats, with average BTO application rate for first-timers holding steady at below two times.

BTO application rate for second-timers has also fallen from a high of 25.9 times in November 2011, to 2.4 times in the current November exercise.

While singles' demand continues to be high, Mr Khaw noted that the BTO application rate for singles has come down from 57.5 times in July this year, to 25.2 times in the latest BTO exercise.

- CNA/fa

[princess_morbucks]

http://www.businesstimes.com.sg/breaking-news/singapore/hdb-construction-taper-14-khaw-20131202government The government will taper off on its "massive from next year, Minister for National Development Khaw Boon Wan announced on his blog on Monday.
He said in a post in Housing Matters that, after three years of sustained effort to put more flats on the market, the balance in the housing market has been restored; more than 77,000 Build-to-Order (BTO) flats have been offered in that time, with more than 25,000 this year.
He said the downward trend in cash-over-valuation (COV) in the resale HDB market was symptomatic of this development and was welcomed.
With the balance between supply and demand for public housing restored, the tapering that will happen will be done "in a measured way, to allow the market to gradually adjust, just like what we had done to cool the property market earlier"

[GIG]

Clever move...slowing down building programme based on BTO application statistics.
At the same time letting HDB price to go down gradually by ensuring continuous supply.

[wt_know]

hdb resale owner hold your horses
cov hayday will be back ... :p

[minority]

soft landing. ah….:scared-2:

[newbie11]

soft landing. ah….:scared-2:

Isn't this good? Taper just when Cov slides. A sign that he is happy with the prices.

[proud owner]

Isn't this good? Taper just when Cov slides. A sign that he is happy with the prices.



COV slides have only just begun... and hes talking about tapering ?


he is Afraid of further slide.....

[august]

I thought he said he wants to build more and always have an excess buffer? :D

[proud owner]

I thought he said he wants to build more and always have an excess buffer? :D



then why talked about tapering in 2014 ... and we are not far from 2014

[minority]

didnt u read the papers. the guy trying to sell his place have negative COV sound sad and disappointed?

[4wheels]

didnt u read the papers. the guy trying to sell his place have negative COV sound sad and disappointed?

How about the guys who want to buy but cov is high.:)

[minority]

How about the guys who want to buy but cov is high.:)

BTO…. peng u. BTO. who ask them die die must buy resale. no 1 pt gun at their head mah.

[chiaberry]

COV high, not happy. COV low, not happy. You can never make everyone happy because buyers will be unhappy with high COV and sellers will be unhappy with low COV and vice versa. Is there even an "ideal" COV? Should it be zero?

[ichigo55]

very clever marketing move ..
telling you BTOs are now 'limited'

[catsick]

This dude is acting like a Bernanke or greenspan, he has been letting the HDB supply presses run out of control but now he has ammassed a vast supply pipeline is signalling a tapering off may happen in the future if he gets his desired fall in prices to an acceptable level

[oops]

What if those BTOs are unsold? Sell cheap as sale of balance to public!

[RCT]

I think HDB have already released more HDB that the public can abosrb.. They have already remove the pressure from resale HDB..

More couples are going for BTO as it is easier now to get. Another thing we must remember, for every EC sold to upgrader, we will have one resale HDB unit in the market. Look at the amount of EC being released and sold in the last two years. So you can expect a lot of resale flat to flood the market once those EC is finished. Also the restriction on PR to buy HDB, it will block a lot of PR at least to 2015/16

[wind30]

he is scared what will happen to the market when all the BTOs are built.

I think launching BTO has two cooling effects.

1) suck in money from buyers so they cannot buy other stuff
2) once the unit gets build, where ever the buyer is staying in previously get vacated and housing supply goes up.

I think he is scared when 2 happens, the market will just fall too much. but 2 is beyong his control now....

[princess_morbucks]

http://www.channelnewsasia.com/news/singapore/reactions-to-hdb-scaling/908338.html?utm_source=dlvr.it&utm_medium=twitter

SINGAPORE: The government has said it will be scaling back the supply of new flats in 2014.


This year, the HDB launched over 25,000 Build-To-Order (BTO) flats.
One property analyst expects BTO flats to be reduced by between 30 and 50 per cent next year.


Jeffrey Hong, CEO of GPS Alliance, said "(A gradual) 30 to 50 per cent reduction should be sufficient to test the market from quarter to quarter basis.


"And if you reduce, you reduce certain segment of the market gradually. For example, in my opinion, they may start to reduce the five-room flats first."


Meanwhile, Christine Li, head of research and consultancy at OrangeTee, expects the supply of new flats to take a cue from marriage rates.


The number of marriages in Singapore has been hovering around 27,000 for the past two years.


However, not all newly married couples will choose a BTO flat.


She explained: "If you look at the marriage rates and the number of BTOs, it seems that the government is supplying almost one brand new HDB flat to one married couple. I think this rate is not sustainable.


"Going forward, the government will definitely taper down to a more sustainable level to ensure the stability of the housing market."

[chiaberry]

Those BTOs look yummy! I like the 3 generation flats in Yishun and the BTOs facing Telok Blangah park! Took a look at the models in HDB hub when I went to pay my SP bill last week.

[princess_morbucks]

Those BTOs look yummy! I like the 3 generation flats in Yishun and the BTOs facing Telok Blangah park! Took a look at the models in HDB hub when I went to pay my SP bill last week.

Yes, the 3 gen flats look attractive.
Space is well made used of.

[reporter2]

http://www.straitstimes.com/archive/tuesday/premium/top-the-news/story/supply-new-hdb-flats-be-reduced-next-year-20131203

Supply of new HDB flats to be reduced from next year

Published on Dec 03, 2013

By Janice Heng


THE supply of new flats will be tapered off from next year, Minister for National Development Khaw Boon Wan said yesterday.

His comments came at the close of the Housing Board's largest-ever launch of Build-to-Order (BTO) and balance flats.

A three-year period of ramped-up supply, which has seen more than 77,000 BTO flats launched, has "begun to restore the balance in our housing market", Mr Khaw wrote on the ministry's blog.

He noted lower cash premiums in the resale market and falling application rates for new flats as signs of this new balance.

The average BTO application rate was 2.9 per flat this year, down from a high of 5.3 in 2010. No figure was given, but he added the tapering off will be done "in a measured way to allow the market to gradually adjust".

ERA Realty key executive officer Eugene Lim expects the pace of building to take a cue from the marriage rate. As previously unmet demand is fulfilled, first- time married couples will once again drive demand for new flats.

OrangeTee head of research Christine Li believes the Government will look to build around 18,000 new flats a year.

Meanwhile, the November BTO launch faced a lukewarm response ahead of its close at midnight last night. As of 5pm yesterday, there were 1.2 first-timers applying for each BTO flat. The rate for second-timers was 2.4, down from a high of 25.9 in November 2011, noted Mr Khaw.

Demand from singles remained strong, with more than 25 vying for each two-room flat.

But Mr Khaw added that this was down from the rate of 57.5 in July, the first time singles were allowed to buy new flats.

Analysts said the overall low demand was unsurprising given the large joint launch, with balance flats - those remaining from previous launches - usually siphoning off some BTO demand.

The BTO flats are also in non-mature estates and not very attractive locations, they said.

First-timer Ms Siti Hajaar, 26, expected little competition when she and her husband applied for a five-room flat in Jurong West. But she did not expect there to be more such units than buyers, as was the case last night: "Hopefully, the chances of us getting the flat are higher."

Meanwhile, there were under four applicants for each balance flat compared with eight per flat in the previous launch in May.

R'ST Research director Ong Kah Seng said this showed "quite keen interest" in balance flats, but this could cool further as resale prices fall.

[email protected]

[reporter2]

http://www.businesstimes.com.sg/archive/tuesday/premium/top-stories/hdb-construction-taper-2014-20131203

Published December 03, 2013

HDB construction to taper from 2014

Khaw: It will be done in a measured way to allow market to gradually adjust

By ong chor hao [email protected]


[SINGAPORE] The massive construction of HDB flats will start to taper off from next year as balance is restored between demand and supply in the market, Minister for National Development Khaw Boon Wan said.

But "we will do so in a measured way, to allow the market to gradually adjust, just like what we had done to cool the property market earlier."

"Three years of sustained ramp-up have begun to restore the balance in our housing market," he wrote on his blog yesterday as the latest launch of 8,952 Build-to-Order (BTO) and Sale of Balance Flats (SBF) units last month drew to a close.

That exercise has been the largest single launch in the history of the Housing and Development Board (HDB), with the previous mark set in September 2011, when 8,262 units were offered.

Over the past year, HDB has delivered more than 25,000 BTO flats, and it has offered more than 77,000 BTO flats in the last three years.

The trend for the cash premium of cash-over-valuation (COV) was "symptomatic" of the balancing, said Mr Khaw, who welcomed the development.

COVs have been on a downward trend since the start of the year. The median COV in October was $12,000, according to data from the Singapore Real Estate Exchange (SRX). This is a 66 per cent drop from the $35,000 median in January.

OrangeTee estimated last month that one in five flats in Singapore was being sold at zero COV or even negative COV.

A Straits Times report on Monday cited HDB as saying 105 units were sold below valuation in October. This translates to 7 per cent of total resale volume, compared with an average of 0.3 per cent for each month of the first half of the year.

Mr Khaw said another sign of a more balanced housing market was in the decline of the number of applicants per unit. The average BTO application rate has fallen from a high of 5.3 in 2010 to a low of 2.9 this year, he said.

"We have cleared the backlog of young families buying their first flats, with average BTO application rate for first-timers holding steady at below two times."

The application rate (excluding studio apartments) in the latest November exercise was 1.2, HDB data showed yesterday.

For second-timers, average application rates for BTO flats fell to 2.4 times in the latest exercise from the peak of 25.9 times in November 2011.

That said, demand from singles remained high, with average BTO application rates at 25.2 times in the latest exercise, but still down July's 57.5 times, when the government first launched projects with BTO flats set aside for eligible singles.