19.5% drop to 6,475 units amid concerns of oversupply and slowing demand
Concerns about oversupply and slowing demand following the July cooling measures and general economic uncertainty have put the squeeze on the Government’s Land Sales programme for the first half of next year.
The sites listed yesterday for the first half of next year will yield fewer private homes, according to the Ministry of National Development (MND). It is releasing land that can yield 6,475 private home units – including 910 executive condominium (EC) units – the lowest supply since the first half of 2007, when just 5,475 units were offered.
The confirmed list has 2,025 of the 6,475 units, while the remaining 4,450 units are on the reserve list.
The upcoming supply is 19.5 per cent lower than the 8,040 units – including 1,210 ECs – released in the second half of this year.
A key concern is that the supply pipeline now stands at 45,000 units – comprising 31,000 unsold homes from Government Land Sales and collective sale sites with planning approval, and 14,000 units from sites pending planning approval.
There are also around 28,000 existing vacant private housing units, the MND said.
The upcoming programme will comprise five confirmed-list sites, which can be launched regardless of demand, and nine reserve-list sites, which are put on sale only when a developer makes an acceptable minimum bid or when there is sufficient market interest.
Besides the 6,475 homes, these sites can yield commercial space of 86,000 sq m in gross floor area (GFA), as well as 1,115 hotel rooms. That compares with the commercial space of 124,200 sq m in GFA and 930 hotel rooms in this half.
Analysts say most of the upcoming confirmed-list sites have good locations, but developers are likely to be selective. Seven of the 14 sites on the confirmed and reserve lists in the first half of next year are new: one-north Gateway, Bernam Street, Canberra Link (EC), Fernvale Lane (EC), Dunman Road, Hillview Rise and Sims Avenue.
“Some of the (confirmed-list) sites are released to support the residential needs from key development areas like one-north and North Coast Innovation Corridor,” said Mr Desmond Sim, CBRE head of research for Singapore and South-east Asia.
The one-north site should draw healthy interest, given the development of the one-north area and dearth of new homes nearby.
Colliers International head of research for Singapore Tricia Song noted that Bernam Street is a “rare fresh site in the Shenton Way (area) and near the future Greater Southern Waterfront development”. “The last time a residential site was offered in that area was in 2007 – two sites in Enggor Street, developed into Altez and Skysuites @ Anson.”
Standout sites on the reserve list include Dunman Road, Marina View, Sims Avenue and Fernvale Lane (EC), she said, adding: “The unexpected plot is perhaps the new hotel site in Sims Avenue. It will complement the Government’s plan to rejuvenate the area and transform Paya Lebar into a regional commercial hub.”
She said the Dunman Road site is the most attractive one, given its proximity to Dakota MRT station and Paya Lebar Quarter. “But a concern could be its relatively larger size – 1,070 buildable units,” she said.
The reserve list includes a white site in Woodlands Avenue 2 for a mixed-use development to help “sustain the development momentum of Woodlands Regional Centre as a major commercial node outside the city”, MND said.
“Source:[Fewer private homes from upcoming Govt Land Sales] © Singapore Press Holdings Limited. Permission required for reproduction”