Govt property measures still necessary

Govt property measures still necessary
Redas President, Chia Boon Kuah.

SINGAPORE - The Real Estate Developers' Association of Singapore (Redas) warned that without "supportive measures" from the Government, the country would face unintended outcomes from a worsening economy ("Property sector 'needs govt support'"; last Thursday).

What Redas is essentially asking is that the Government cut the land supply for residential programmes to boost home prices in this period of weak housing demand.

However, this would create a situation where property developers can always rely on the Government to make a profit.

They could keep pricing their houses higher, whether or not demand exceeds supply.

The Government's property cooling measures aim to ensure affordability of homes so that buyers do not overstretch themselves.

Scaling back these cooling measures may encourage reckless property speculation among the public.

Would it be prudent for the Government to reverse its policies so that property developers continue to profit, at a time when property prices are still high and the general population has sunk a large part of their finances into their properties?

This article was first published on December 1, 2014.
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