DEVELOPERS are in talks with the Government, seeking an increase in the supply of affordable sites across the island for mass- to mid-market projects.
Real Estate Developers' Association of Singapore (Redas) president Simon Cheong said yesterday that a good spread of such sites would lead to less aggressive bidding, which would in turn mean greater affordability for home buyers.
Recent bidding for some land, including far-flung sites, has been more aggressive than usual with sites seeing a dozen or more bids from developers amid booming demand.
This tends to drive up the price of the land, which then filters down to higher unit prices when the condo goes on sale.
Redas is in discussions with the Urban Redevelopment Authority (URA) for the release of a wider spread of sites under its Government Land Sales Programme.
This means not just suburban sites near MRT stations, but also those further afield, so that developers have a variety of sites to bid for.
The programme's confirmed list of sale sites, which was suspended late last year when the market was in the doldrums, will resume next year - a government move to increase the supply of new sites and cool rising prices.
These confirmed sites will be put up for sale according to a pre-determined schedule, and regardless of developers' prior expressions of interest.
'We'd like to work with the URA, to see there's a more even spread and adequate sites. Perhaps, in the next confirmed list, we will have sites more spread out across the island,' said Mr Cheong at the Redas Mid-Autumn Festival celebration at The Fullerton Hotel yesterday.
He also reiterated the view that Singapore's property boom was not a bubble.
Flash estimates released by the URA on Thursday showed private home prices surging 15.9 per cent last quarter, reversing four quarters of decline.
While this is evidence of a private residential market rebound, analysts have expressed concern over a possible bubble amid an uncertain economic outlook.
But Mr Cheong, who is also SC Global's chairman and chief executive, said the property run here is 'based on fundamentals, and is not unique'. Across the region, Hong Kong, Shanghai and Beijing have also seen a property revival, he said.
'That's a testament to the good economic policy of the Asian economies,' he said.
'We do not have a credit crisis like in the West. In fact, we have net savings... and it's not unreasonable to think that it'll go towards properties.'
City Developments' group general manager Chia Ngiang Hong added that strong buying momentum was due to pent-up demand over the past year.
Last year, developers sold only 4,264 units, while sales are expected to total between 13,000 and 15,000 this year.
Mr Cheong said that 'prices will remain firm' for the near future and that buyers can be assured that developers 'will produce where there's demand'.
Hong Leong Group chairman Kwek Leng Beng too was optimistic, saying: 'I am of the view that within the next three to five years, Singapore will have recovered well.'
Frasers Centrepoint chief executive Lim Ee Seng noted that tender bids for land have been on the high side recently.
Among the sites awarded recently, Far East Organization submitted a bid of $119.08 million for the mainly residential site at the corner of Yio Chu Kang Road and Seletar Road - 35 per cent higher than the second bid.
A land parcel at Dakota Crescent recently drew 13 bids and a higher-than- expected top bid of $329 million from UOL - way above the trigger price of $130 million for the reserve list site.
'The release of more land will enable bids to be lower, and this will translate to lower prices for buyers,' said Mr Lim.
It is in everyone's interest that the price appreciation in the property market is long-term and gradual, he said.
Redas also celebrated its 50th anniversary at yesterday's event, where Trade and Industry Minister Lim Hng Kiang was the guest of honour.
In a speech to 300 industry players, Mr Cheong said: 'There is more than sufficient supply of housing in the pipeline to meet future demands. Hence, there is really no need to panic.'
Source: Straits Times, 3 Oct 2009
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