Consultants split on govt land sales in H2

Consultants split on govt land sales in H2

SINGAPORE - Property consultants polled by BT gave a mixed bag of views on what could be in store for the Government Land Sales (GLS) Programme for the second half, reflecting the challenges ahead for Singapore's property market.

Some are expecting the Ministry of National Development (MND) to maintain the overall quantum of land supply for private housing development (including executive condos) at a similar level as the current H1 2013 slate - citing still-strong developer sales in addition to the need to cater to the anticipated population growth in the medium term.

However, others reckon MND could trim the quantum of land for executive condos (ECs) - currently a hot discussion topic - assuming there will be less demand for this public-private hybrid housing should the authorities decide to scrap the housing subsidy for first-time buyers of ECs.

Jones Lang LaSalle's national director of research and consultancy, Ong Teck Hui, said that any change to the EC scheme should be preceded or accompanied by a policy announcement.

"It would be a bit drastic to stop selling EC sites immediately as the government should explain how the 'sandwich class' will be taken care of." The term refers to those with incomes exceeding limits set for buyers of new public housing flats but who find private homes beyond reach.

DTZ's SE Asia chief operating officer Ong Choon Fah observed that the government will continue to supply land for private housing development as long as there is demand "so prices are sustainable". However, it will have to factor in the large number of residential units under construction - in both the private and public segments, she added. "Who will occupy them upon completion?"

Some market watchers reckon the authorities may be leaning towards allocating a higher proportion of total private housing land (including ECs) on the reserve list than in the confirmed list; currently, the split is even.

"This will allow the market more flexibility to trigger sites on the reserve list based on . . . demand, rather than be constrained by a confirmed sale date," said CBRE Research associate director Desmond Sim. A reserve list will be launched only upon successful application by a developer. Confirmed list sites, on the other hand, are released according to a prestated schedule regardless of demand.

CBRE predicts that the H2 2013 GLS Programme will yield up to 11,000 private homes (including ECs) - with about 3,000-4,000 units on the confirmed list and the majority 6,000-7,000 units on the reserve list.

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