Next year’s supply may even exceed this year’s record 16,000 new flats

HOME buyers could have more than 16,000 new build-to-order (BTO) flats to choose from next year if demand continues at its present pace, said National Development Minister Mah Bow Tan.

The flats will be offered in mature HDB estates such as Tampines and Pasir Ris as well as outlying housing areas.

Mr Mah told the media yesterday: ‘If demand remains at this level, we will certainly push out a new supply of HDB flats at the same level, if not higher.’

Demand is now strong and while there are signs of an economic slowdown, the momentum should continue.

‘Going forward, I can safely say that we will continue to see this growth, and therefore we are preparing for continued supply,’ added Mr Mah, who was speaking on the sidelines of his ministry’s National Day Observance Ceremony where he presented awards to staff.

‘We are confident it will be taken up. It will be at least 16,000 new flats.’

The Government has pushed up the supply of BTO flats to 16,000 this year – about 80 per cent more than for last year and likely the highest in a decade.

The HDB had gone on an intensive building drive in the boom years of the 1990s, only to stop building new flats in new towns in 2002 as it had some 17,500 unsold flats.

The increased supply now is to meet sizzling demand, as BTO projects continue to be oversubscribed and surging HDB resale prices continue to scale new highs.

Mr Mah said late last month that the supply and demand imbalance will be arrested soon by the record number of HDB flats being released this year with prices likely to stabilise in about a year or so.

He also noted yesterday that new flats will be launched in areas other than Punggol and Sengkang, where most of the existing available land is.

‘We’re now looking for pockets of land in other parts of Singapore now that we have fulfilled our promise to Punggol,’ he added.

Mr Mah said Punggol has achieved a critical mass of 21,000 to 22,000 flats, a level that can support facilities like a new shopping mall and a town centre.

The minister also said that many young couples want to live near their parents, their children’s schools or their workplaces, so there is a demand for new flats in mature estates.

These estates will not be in downtown Singapore but could be in Tampines and Pasir Ris, he said.

He said more details will be available once the land is identified and prepared.

‘Each site is chosen very carefully… We want to build close to amenities… What HDB is doing is they are now looking for all these different pieces of land,’ he added.

‘But the direction is to start to spread out the building programme into other areas.’

The HDB will also be building flats in entirely new estates.

‘One day, we’ll have to look at opening up new land, new estates… as eventually, we will run out of available land.’

But this will require a lot of preparation and is costly as the Government will have to put in brand new infrastructure and sewerage systems, he said.

Earlier this year, Mr Mah had mentioned that the Government will consider building flats in new areas such as Simpang in the north-east, along the Strait of Johor and Tengah in the west.

He reiterated yesterday that priority will continue to be given to first-time home buyers.

Second-timers can head for the resale market, though they should not rush in if they can afford to hold off.

‘If it is not so urgent, I would advise you to hold back for a while because you already have a flat to stay in… Consider holding back till the resale market stabilises,’ Mr Mah said.

When asked about the recent tweak to the project completion period for private residential sale sites from six to five years, he said that it should not affect many developers but it does give better assurance of the supply coming onstream.

‘The longer the (completion period), the more uncertain the supply projections going forward.’

Meanwhile, five teams from the National Development Ministry received awards for their projects on work such as eating well for less by choosing frozen meat as an alternative to chilled meat, assisting HDB lessees in financial difficulty and the master plan 2008 review.

Source: Straits Times, 7 Aug 2010