Property Market to remain vibrant in the next few years in view of tapering off of public housing
Property analysts 938LIVE spoke to expect the general property market to remain vibrant - even in the face of an imminent reduction in the supply of new flats starting next year.
They were responding to National Development Minister Khaw Boon Wan's blogpost yesterday.
Our News Desk reports.
Writing in his blog, Mr Khaw says the Government will be tapering off the construction of public housing gradually, having seen signs of supply and demand balancing off.
The HDB has rolled out more than seventy-seven thousand Build-To-Order flats over the last three years.
Senior director of research and consultancy at Savills Singapore, Alan Cheong believes the Government will now look to build around not more than 17 thousand flats each year.
He says this number would likely be able to satisfy the demand backlog for flats, and also cater to demand from the newly weds.
Singapore currently has about 21 thousand first-time marriages each year.
Asked if rolling out fewer flats and lesser choices for applicants would result in an abundance of supply, and hence dragging down general property prices, Mr Cheong had this to say.
"For BTO flats it's different, you can have a situation of slight excess supply, but the landlord is the government, so the government has holding power because it's a sovereign balance sheet. We have seen even in periods of time when we have a surplus of housing to the tune of 30, 50 or even 60 thousands of units, overall property prices only came down by 5 to 10 per cent. So I don't think prices would react too negatively."
OrangeTee's research head, Christine Li shares the same sentiment.
She says there are currently no signs showing that transaction numbers in the property market are starting to slow down.
"With the current ruling that if you buy EC, by the time you collect your key, you have to dispose your HDB flats. And, we are also seeing a lot of BTO flats completing in the next couple of years, second timers will then need to give up their flats. So in any case, there will be a lot more transaction, that could support the transaction volume."
-By Lee Gim Siong
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