Thursday, July 9, 2009

HDB to offer at least 8,000 new flats

It will 'calibrate supply' to meet some of the demand - but not all

THE Housing and Development Board (HDB) will offer 8,000 new flats this year, or more if the pickup is stronger, said National Development Minister Mah Bow Tan yesterday.

He said the board is monitoring demand and will 'calibrate its supply of new flats' to meet some of that demand - but not all.

The HDB launched about 1,300 new flats in the first quarter of the year under its build-to-order (BTO) system, where units are built only when a certain level of demand is reached.

It plans to launch a further 2,400 such flats from April to September, subject to demand. The bulk of these will be in Punggol.

Last year, the HDB launched about 7,800 new flats under its BTO system.

Mr Mah, who was speaking on the sidelines of an industry event, said prices in the HDB resale market have stabilised.

Recent HDB flash estimates showed that resale prices rose 1.2 per cent in the second quarter to hit a record high after dipping 0.8 per cent in the first quarter.

This surprised analysts and industry observers, who had expected prices to fall amid Singapore's worst recession.

But Mr Mah said: 'The fact is that the HDB market is a large market...with prices going up or down by 1 per cent, I would term it a stable market, not a rising market.'

He also said the HDB will continue to supply new housing units but 'we cannot be building new flats to cater to every last person who wants a new flat...because if you do that, then obviously you are over-building'.

Some of the new demand will have to be met by resale flats, which have advantages in that buyers can move in immediately and select the location of the flats, he said.

If there is increased demand, the HDB will push out more units, he added. 'In this way, we manage the demand and, at the same time, that helps to keep the HDB resale market prices stable. I think that's something all HDB flat owners will welcome.'

PropNex chief executive Mohamed Ismail said yesterday that new HDB launches will likely be easily absorbed, especially as demand has surged in the second quarter compared with the first.

The resale market is attractive now because it requires low or no upfront cash to be paid over the valuation of a unit, he said. 'Resale flats are a natural choice for buyers who don't want to wait three years for a new flat.'

Mr Mah also flagged affordability of flats as something the HDB is closely monitoring. 'That is the key. If flats remain affordable, the HDB market will have healthy demand.'

Source: Straits Times, 09 July 2009

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