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Thread: HDB boosts flat supply to 13,500

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    Default HDB boosts flat supply to 13,500

    http://www.businesstimes.com.sg/sub/...60798,00.html?

    Published November 24, 2009

    YESTERDAY IN PARLIAMENT

    HDB boosts flat supply to 13,500

    Ramp-up from planned 6,000 due to demand turnaround in H2

    By EMILYN YAP


    THE Housing and Development Board (HDB) estimates it has to offer 10,000 to 12,000 new flats every year for the next five years to meet demand, National Development Minister Mah Bow Tan told Parliament yesterday.

    Responding to strong demand, HDB will offer 13,500 flats in 2009, he said. This is about 'half the number of flats in Bukit Panjang or Pasir Ris town'.

    Public housing was a hot topic in Parliament yesterday, as applications surged for new flats and resale flat prices soared to record levels in the third quarter.

    According to Mr Mah, HDB started the year with a planned flat supply of 6,000, as the economy was stuck in recession. It had to ramp up flat supply as an unexpected turnaround in the second half of the year boosted demand.

    'If take-up of BTO (Build-To-Order) flats remains strong, we will continue to push out more flats under BTO next year - at least one every month if necessary,' he said.

    In the next five years, HDB projects that it has to offer 10,000 to 12,000 new flats per year, he continued. The agency arrived at these figures after taking into account various factors, in particular the number of new households formed from marriages and immigration, and resale flat transactions.

    This medium-term projection serves as a guide for the BTO system, Mr Mah said. But he stressed: 'What actually happens a few years down the road is not known. Demand is also not constant. It varies from year to year, depending on economic and other factors.'

    Mr Mah also said HDB has a 'small buffer' of flats over and above those from the BTO scheme. HDB did not intentionally plan this buffer - it comprises surplus flats from other programmes such as the Selective En-bloc Redevelopment Scheme.

    PropNex chief executive Mohamed Ismail believes that the projected 10,000 to 12,000 new flats a year is adequate. 'Over-supply would only serve to dampen the asset value of a majority of Singaporeans who live in HDB flats,' he said. 'We must also consider the continual supply of resale flats, potentially amounting to 40,000 transactions this year alone.'

    Chesterton Suntec International research and consultancy director Colin Tan agrees the projected number of new HDB flats seems reasonable. But he is concerned about whether there is a mechanism to warn HDB of a potential sudden increase in demand.

    Population growth and immigration will drive up demand for flats. In a report issued yesterday, DBS Vickers projected in a base case scenario that Singapore's population could reach 6.5 million in 2027. It estimates that HDB may have to build an average of 14,000 flats a year over the next 20 years to meet public housing demand.

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    http://business.asiaone.com/Business...24-181820.html

    Tue, Nov 24, 2009

    my paper

    HDB to offer 10,000 flats per year

    By Rachel Chan


    MEASURES that were taken to cool the private property market appear to have worked, said National Development Minister Mah Bow Tan in Parliament yesterday, underlining what many analysts had already concluded.

    He noted that the Urban Redevelopment Authority's monthly data showed that sales of private residential properties by developers fell month-on-month by 37 per cent in September, and by a further 29 per cent last month.

    He attributed this, in the first instance, to the removal of the interest-absorption scheme and the interest-only loans scheme in September.

    A third reason, he noted, was that the Ministry of National Development (MND) had reinstated land sales of eight residential sites on the confirmed list, scheduled for the first half of next year. This was a further signal that the Government intended to keep private homes affordable.

    MND had suspended the list in October last year as the property market weakened, but recently decided to reinstate it as private-home demand and prices surged again.

    These eight sites can hold an estimated 2,900 units, Mr Mah said. Another 18 sites have been put on the reserve list, he added, and all together, these sites can generate about 10,600 units - the highest from any half-yearly Government Land Sales Programme since the reserve list system started in 2001.

    On meeting the demand for Housing Board flats, Mr Mah said that the build-to-order supply has been increased to 5,000 flats in the last quarter of this year.

    He said: "If we include the recent sale of balance flats last month, HDB would have offered over 7,000 flats in three months, and a total of 13,500 flats this year.

    "This is about half the number of flats in Bukit Panjang or Pasir Ris town. At this rate, HDB would have offered enough flats to fill another Bukit Panjang or Pasir Ris in just two years."

    Mr Mah offered this projection:

    "In the next five years, HDB estimates that it will need to offer between 10,000 and 12,000 new flats per year to meet demand."

    Addressing a question by Mr Chiam See Tong on construction costs, he said that "the total cost of building flats varies based on when we build, where we build and what we build... It varies from $230,000 for a three-room flat in Punggol to $530,000 for a five-room flat in Tiong Bahru".

    HDB does not price its flats on a cost-plus-profit basis, he reminded the House.

    Taken together with the additional housing grant, which varies from $5,000 to $40,000, buyers on average enjoy subsidies amounting to about 20 per cent of the market price of a four-room flat.

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    Default Up to 12,000 flats yearly to meet growing demand

    http://www.straitstimes.com/PrimeNew...ry_458170.html

    Nov 24, 2009

    Up to 12,000 flats yearly to meet growing demand

    By Jessica Cheam


    THE Housing Board expects to offer between 10,000 and 12,000 flats every year over the next five years to meet growing demand, National Development Minister Mah Bow Tan said yesterday.

    That will serve as a guide for HDB's build-to-order (BTO) scheme, with the actual number made available depending on market conditions.

    'What actually happens a few years down the road is unknown. Also, demand is not constant - it varies from year to year, depending on economic and other factors,' he told Parliament.

    Taking questions from members on housing issues, he noted that HDB had responded swiftly to this year's spike in demand, by raising its planned supply of 6,000 flats for the year to 13,500.

    'If the take-up of BTO flats remains strong, we will continue to push out more flats under BTO next year - at least one (project) every month if necessary,' said Mr Mah.

    While HDB does not have a policy of keeping vacant flats as a buffer, it nonetheless has a supply of flats that are ready for occupation, he disclosed. Such flats make up about 10per cent of all new flats.

    He was responding to a query from MP Cynthia Phua (Aljunied GRC), who asked whether HDB could consider keeping a stock of ready flats for families who were in urgent need of a home.

    'Although I have said that we do not plan for a buffer, in actual fact there is a buffer of flats over and above the BTO (flats) which are available and have shorter waiting times,' said Mr Mah.

    These available flats are leftovers from other HDB schemes - such as the Selective En-bloc Redevelopment Scheme and surplus BTO flats - which are sold under HDB's sales of balance flats exercise.

    Ready flats are hugely popular because buyers do not have to wait to move in. This is in contrast to the BTO scheme, under which buyers typically have to wait three to four years.

    Touching on the issue of cost, Mr Mah said that the total cost of flats varied according to 'when we build, where we build and what we build'.

    It included the cost of land, construction and ancillary services, and varied from $230,000 for a three-room flat in Punggol to $530,000 for a five-room one in Tiong Bahru.

    He reiterated that HDB does not price its flats based on cost plus profit, but on a market price with a generous discount.

    The selling price was sometimes more than total development cost and at other times, it was less than the cost - especially when construction costs are high, which has been the case over the past few years.

    'Overall, HDB incurs a large deficit in building and selling flats every year, as reflected in its audited annual accounts. In its financial year from 2008 to 2009, HDB incurred a deficit of $1.5 billion for the home ownership programme alone,' he added.

    First-time buyers were assured that there would be sufficient affordable housing.

    HDB recently increased the proportion of flats set aside for first-timers from 90 to 95 per cent. And first-timers are 96 per cent likely to be given a chance to select a flat within two tries, he said.

    Mr Mah said he was prepared to look into the cases of those who were unsuccessful after three tries, to see how HDB could help.

    Analysts said yesterday the planned flat supply over the next five years would help ease demand.

    'This is a marked increase in planned supply, so it's good for the market. The question going forward, is how will HDB more accurately gauge demand,' said Chesterton Suntec International's research and consultancy director, Mr Colin Tan.

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