http://www.businesstimes.com.sg/sub/...92740,00.html?
Published December 4, 2010
A less volatile property market seen in 2011
GLS programme adds record $9.4b to govt coffers in first 11 mths
By UMA SHANKARI
BOOSTED by a buoyant property market, the Government Land Sales (GLS) programme has added a record $9.4 billion of revenue to the state coffers in the first 11 months of this year - more than five times the $1.8 billion of sales recorded last year.
The figures were revealed last night by Simon Cheong, president of the Real Estate Developers Association of Singapore (Redas). He was speaking at a dinner to celebrate the association's 51st anniversary.
Mr Cheong said that developers were positive about the real estate market in Singapore in the long term given the government's continuous drive to reposition the economy. Redas estimates that sales of new homes by developers will hit 14,500 units for the whole of 2010 - in line with previous analyst forecasts.
'We believe the market will continue to be underpinned by sound economic fundamentals and a favourable business environment,' Mr Cheong said.
But he noted that the property market began to slow down in the third quarter after two rounds of government measures to cool the market in February and again in August.
In addition, the land supply for the second half of 2010 under the GLS programme has also been 'very significant', he said.
'As Asian economies including Singapore adjust to this part of the world and tighten up on measures to deal with the threat of overheated property prices, the market will adjust and take into account these new challenges,' Mr Cheong said.
'It is in our interest to see a graduated trend in value movements in order to realise a sustainable environment for real estate development rather than face the volatility arising from mismatched market forces.'
Developers BT spoke to said that they expect a less volatile property market in 2011.
'I see a more stable market,' said Frasers Centrepoint chief executive Lim Ee Seng. 'With the government measures, developers are more measured in their bidding. There should be sufficient supply for buyers, especially for the upgraders market.'
Frasers Centrepoint is especially confident about the upgraders market and will continue to bid for land parcels catering to this segment, Mr Lim added.
Said Koh Brothers managing director Francis Koh: 'A gradual and steady growth in property prices and volumes is better for the whole market.' The property market should continue to do well in 2011 if Singapore's economic performance remains strong, Mr Koh added.
The Ministry of National Development on Nov 25 said it would release a large supply of land for new homes in H1 2011 as demand from both developers and homeowners remains robust. Including reserve list sites, the H1 2011 GLS programme will have a total of 30 sites which can generate about 14,300 residential units, most of which will be in mass-market locations. This is higher than the 13,900 residential units offered for the second half of 2010.
And on the same day, the Monetary Authority of Singapore warned that there is 'a possibility' that property transactions and prices could pick up again given the current global conditions of ample liquidity and low interest rates.
The boom in sales of state land in 2010 will translate to higher sale proceeds for the government's current financial year, which ends on March 31, 2011.