New Reporter
22-06-23, 17:34
Government bumps up supply of private homes for full-year 2023 to highest in a decade
Supply of private homes, including ECs, on confirmed list to rise by 26.2 per cent to 5,160 units in the second half of the year
Jun 22, 2023
THE government has pulled its second lever in as many months to aid in its quest for a sustainable property market.
It announced on Wednesday (Jun 21) a sixth consecutive increase in the supply of private homes on the confirmed list of the half-yearly Government Land Sales (GLS) programme. This brings the total confirmed-list supply of private housing units – including executive condo (EC) units – for 2023 to its highest in a decade, at 9,250.
The most recent cooling measures took effect on Apr 27.
The Ministry of National Development (MND) is raising the supply of private homes on the confirmed list to about 5,160 units – including 560 executive condominium (EC) units – in the second half of this year. This is 26.2 per cent higher than the supply of 4,090 private homes, including 700 EC units, in the current, first-half 2023 GLS programme.
MND also noted that the full-year supply for 2023 is nearly 50 per cent higher than the supply in 2022, and around 2.5 times the supply in 2021.
Wong Xian Yang, head of research for Singapore and South-east Asia at Cushman & Wakefield, said: “The ramp-up in housing supply is in response to resilient market demand and private residential prices, despite a weaker economic outlook and consecutive waves of cooling measures.”
Alan Cheong, Savills Singapore’s executive director of research and consultancy, said: “The 5,160-unit private housing supply from the H2 confirmed list is substantial. It would probably induce developers to be more cautious when bidding for land. This should help to manage land costs.
“On top of that, the slate of cooling measures and their regular recalibration are likely to reduce exuberant demand for private homes. Together, we may see a moderation in price and rental increases.”
Sites on the confirmed list are launched for sale according to schedule, regardless of demand.
MND is also supplying 4,900 square metres (sq m) gross floor area of commercial space through the confirmed list of the H2 2023 GLS programme. This is down from the 106,400 sq m for H1 2023, which was boosted by the Jurong Lake District site.
Meanwhile, on the reserve list, MND will release land for 3,430 private homes, including 855 EC units, in H2 2023. This is 5.4 per cent lower than the supply of 3,625 private housing units, including 855 EC units, in H1 2023. ECs are a public-private housing hybrid.
Sites on the reserve list are launched only upon successful application by a developer, or when there is sufficient market interest.
The commercial space supply on the reserve list for H2 2023 is 93,350 sq m – unchanged from H1 2023. Also unchanged is the supply of 530 hotel rooms on the reserve list. There is no hotel room supply on the confirmed lists of H1 and H2 2023.
“The government will continue to monitor economic and property market conditions and calibrate the supply of future GLS programmes, as necessary, to help meet demand and promote market stability,” MND said.
In all, the H2 2023 GLS programme has eight sites on the confirmed list and nine sites on the reserve list. Four sites in each list are new.
https://i.imgur.com/2CKYNk5.jpg
SOURCE: MND
Among the four new sites on the confirmed list is a plot next to Orchard Boulevard MRT station, that can yield about 270 private homes. Also on the list are two sites along Upper Thomson Road near Springleaf MRT station, that can yield a total of 1,535 private housing units. The fourth new plot, along Zion Road near Great World City, can generate about 955 homes.
An adjacent plot on Zion Road, which can generate 605 private homes, is among four new sites on the latest reserve list. Another fresh prime site on the reserve list is a plot in Holland Drive that can generate some 680 homes; it is near the One Holland Village project and Jalan Mambong.
MND has also injected into the reserve list a private housing site in De Souza Avenue in the Old Jurong Road/Jalan Jurong Kechil locale, that can generate 350 units; as well as an EC plot in Tampines Street 95 that can yield 560 units.
Desmond Sim, chief executive officer of Edmund Tie, said: “The latest GLS programme provides opportunities for developers to buy residential development land in all segments. The Orchard Boulevard site will provide another litmus test on the impact of the doubling of the Additional Buyer’s Stamp Duty (ABSD) rate on foreign buyers to 60 per cent.
“Traditionally, projects in the Core Central Region (CCR) – and even some in the Rest of Central Region (RCR) – tend to have a higher proportion of foreign buyers than in other regions.”
Tricia Song, head of research for South-east Asia at CBRE, noted that prime sites make up half of the eight new land parcels across the confirmed and reserve lists in the H2 2023 slate.
These are the plots at Orchard Boulevard, Holland Drive, and the two in Zion Road. “We have not seen such prime sites since (the H2 2019 GLS programme’s) Irwell Bank Road site, and definitely not as many prime choices in a single GLS programme in a decade or more,” she said.
“The proportion of supply devoted to prime sites is surprising, given the recent cooling measures which included the 60 per cent ABSD on foreigners; this should affect the prime housing market the most. The resilient demand at launches so far has been demonstrated in the suburban and city-fringe projects,” Song added.
“We believe offering prime sites could be aimed at providing a balanced array of medium-term 99-year leasehold choices, as prime launches have also been selling down and private collective sales have dried up.”
Chia Siew Chuin, head of residential research at JLL Singapore, said: “MND has taken a targeted approach to address the supply and demand imbalance with more certainty, as local demand for private housing in the Outside Central Region (OCR) and RCR remains buoyant despite the latest cooling measures.
Knight Frank Singapore’s research head, Leonard Tay, observed that with the start of operations of new MRT lines in recent years, the government is also starting to populate residential catchments near some of the MRT stations on those lines. These include the Orchard Boulevard, Zion Road and Upper Thomson Road plots, which are close to stations on the Thomson-East Coast Line.
Tay also noted that the risks of private residential development have increased substantially. This comes on the back of the latest cooling measures, in addition to the clouded business sentiment and prevailing economic uncertainty.
“It remains to be seen whether developers will have the same appetite for the newly introduced GLS sites, even though demand for new private homes in the mass market and city fringe remains intact,” he added.
Wong of Cushman & Wakefield said the ramp-up in supply from the GLS confirmed list would compete with the private-sector en bloc sale market.
“Assuming sites with similar attributes, developers prefer to acquire from the GLS programme as it is more straightforward. However, seven out of eight sites in the H2 2023 confirmed list are mid- to large-sized sites generating over 500 units each; these may be out of reach for smaller developers. As a result, developers looking for smaller projects would still look towards the en bloc market to buy land,” he said.
Elaborating on the H2 2023 GLS programme, MND said: “Complementing the property market cooling measures, this supply injection will bring the total pipeline supply of private housing (including ECs) to about 63,500 units, and cater to resilient demand.”
That figure comprises 50,200 units that have received planning approval, and 13,300 units from GLS sites and awarded private-sector en bloc sale sites that have yet to be granted planning approval.
Out of the total pipeline supply, about 40,400 units will be completed between 2023 and 2025, which is more than double the 20,000 units that were completed from 2020 to 2022.
“This forms part of the total supply of about 100,000 public and private housing units to be completed between 2023 and 2025, which will help to cater to housing needs in the immediate few years ahead,” MND said.
https://www.businesstimes.com.sg/property/government-bumps-supply-private-homes-full-year-2023-highest-decade
Supply of private homes, including ECs, on confirmed list to rise by 26.2 per cent to 5,160 units in the second half of the year
Jun 22, 2023
THE government has pulled its second lever in as many months to aid in its quest for a sustainable property market.
It announced on Wednesday (Jun 21) a sixth consecutive increase in the supply of private homes on the confirmed list of the half-yearly Government Land Sales (GLS) programme. This brings the total confirmed-list supply of private housing units – including executive condo (EC) units – for 2023 to its highest in a decade, at 9,250.
The most recent cooling measures took effect on Apr 27.
The Ministry of National Development (MND) is raising the supply of private homes on the confirmed list to about 5,160 units – including 560 executive condominium (EC) units – in the second half of this year. This is 26.2 per cent higher than the supply of 4,090 private homes, including 700 EC units, in the current, first-half 2023 GLS programme.
MND also noted that the full-year supply for 2023 is nearly 50 per cent higher than the supply in 2022, and around 2.5 times the supply in 2021.
Wong Xian Yang, head of research for Singapore and South-east Asia at Cushman & Wakefield, said: “The ramp-up in housing supply is in response to resilient market demand and private residential prices, despite a weaker economic outlook and consecutive waves of cooling measures.”
Alan Cheong, Savills Singapore’s executive director of research and consultancy, said: “The 5,160-unit private housing supply from the H2 confirmed list is substantial. It would probably induce developers to be more cautious when bidding for land. This should help to manage land costs.
“On top of that, the slate of cooling measures and their regular recalibration are likely to reduce exuberant demand for private homes. Together, we may see a moderation in price and rental increases.”
Sites on the confirmed list are launched for sale according to schedule, regardless of demand.
MND is also supplying 4,900 square metres (sq m) gross floor area of commercial space through the confirmed list of the H2 2023 GLS programme. This is down from the 106,400 sq m for H1 2023, which was boosted by the Jurong Lake District site.
Meanwhile, on the reserve list, MND will release land for 3,430 private homes, including 855 EC units, in H2 2023. This is 5.4 per cent lower than the supply of 3,625 private housing units, including 855 EC units, in H1 2023. ECs are a public-private housing hybrid.
Sites on the reserve list are launched only upon successful application by a developer, or when there is sufficient market interest.
The commercial space supply on the reserve list for H2 2023 is 93,350 sq m – unchanged from H1 2023. Also unchanged is the supply of 530 hotel rooms on the reserve list. There is no hotel room supply on the confirmed lists of H1 and H2 2023.
“The government will continue to monitor economic and property market conditions and calibrate the supply of future GLS programmes, as necessary, to help meet demand and promote market stability,” MND said.
In all, the H2 2023 GLS programme has eight sites on the confirmed list and nine sites on the reserve list. Four sites in each list are new.
https://i.imgur.com/2CKYNk5.jpg
SOURCE: MND
Among the four new sites on the confirmed list is a plot next to Orchard Boulevard MRT station, that can yield about 270 private homes. Also on the list are two sites along Upper Thomson Road near Springleaf MRT station, that can yield a total of 1,535 private housing units. The fourth new plot, along Zion Road near Great World City, can generate about 955 homes.
An adjacent plot on Zion Road, which can generate 605 private homes, is among four new sites on the latest reserve list. Another fresh prime site on the reserve list is a plot in Holland Drive that can generate some 680 homes; it is near the One Holland Village project and Jalan Mambong.
MND has also injected into the reserve list a private housing site in De Souza Avenue in the Old Jurong Road/Jalan Jurong Kechil locale, that can generate 350 units; as well as an EC plot in Tampines Street 95 that can yield 560 units.
Desmond Sim, chief executive officer of Edmund Tie, said: “The latest GLS programme provides opportunities for developers to buy residential development land in all segments. The Orchard Boulevard site will provide another litmus test on the impact of the doubling of the Additional Buyer’s Stamp Duty (ABSD) rate on foreign buyers to 60 per cent.
“Traditionally, projects in the Core Central Region (CCR) – and even some in the Rest of Central Region (RCR) – tend to have a higher proportion of foreign buyers than in other regions.”
Tricia Song, head of research for South-east Asia at CBRE, noted that prime sites make up half of the eight new land parcels across the confirmed and reserve lists in the H2 2023 slate.
These are the plots at Orchard Boulevard, Holland Drive, and the two in Zion Road. “We have not seen such prime sites since (the H2 2019 GLS programme’s) Irwell Bank Road site, and definitely not as many prime choices in a single GLS programme in a decade or more,” she said.
“The proportion of supply devoted to prime sites is surprising, given the recent cooling measures which included the 60 per cent ABSD on foreigners; this should affect the prime housing market the most. The resilient demand at launches so far has been demonstrated in the suburban and city-fringe projects,” Song added.
“We believe offering prime sites could be aimed at providing a balanced array of medium-term 99-year leasehold choices, as prime launches have also been selling down and private collective sales have dried up.”
Chia Siew Chuin, head of residential research at JLL Singapore, said: “MND has taken a targeted approach to address the supply and demand imbalance with more certainty, as local demand for private housing in the Outside Central Region (OCR) and RCR remains buoyant despite the latest cooling measures.
Knight Frank Singapore’s research head, Leonard Tay, observed that with the start of operations of new MRT lines in recent years, the government is also starting to populate residential catchments near some of the MRT stations on those lines. These include the Orchard Boulevard, Zion Road and Upper Thomson Road plots, which are close to stations on the Thomson-East Coast Line.
Tay also noted that the risks of private residential development have increased substantially. This comes on the back of the latest cooling measures, in addition to the clouded business sentiment and prevailing economic uncertainty.
“It remains to be seen whether developers will have the same appetite for the newly introduced GLS sites, even though demand for new private homes in the mass market and city fringe remains intact,” he added.
Wong of Cushman & Wakefield said the ramp-up in supply from the GLS confirmed list would compete with the private-sector en bloc sale market.
“Assuming sites with similar attributes, developers prefer to acquire from the GLS programme as it is more straightforward. However, seven out of eight sites in the H2 2023 confirmed list are mid- to large-sized sites generating over 500 units each; these may be out of reach for smaller developers. As a result, developers looking for smaller projects would still look towards the en bloc market to buy land,” he said.
Elaborating on the H2 2023 GLS programme, MND said: “Complementing the property market cooling measures, this supply injection will bring the total pipeline supply of private housing (including ECs) to about 63,500 units, and cater to resilient demand.”
That figure comprises 50,200 units that have received planning approval, and 13,300 units from GLS sites and awarded private-sector en bloc sale sites that have yet to be granted planning approval.
Out of the total pipeline supply, about 40,400 units will be completed between 2023 and 2025, which is more than double the 20,000 units that were completed from 2020 to 2022.
“This forms part of the total supply of about 100,000 public and private housing units to be completed between 2023 and 2025, which will help to cater to housing needs in the immediate few years ahead,” MND said.
https://www.businesstimes.com.sg/property/government-bumps-supply-private-homes-full-year-2023-highest-decade