Government’s Highest Potential Supply In The History Of GLS Programs
CAN GOVERNMENT OVERCOME HIGH RISE PROPERTY PRICING BY LAUNCING FIVE NEW PRIVATE SITES?
Government decided to launch, five sites for private home seekers. Singapore Government has made available sites that can yield about 13,900 private housing units, of which about 8,100 units are on confirmed list of Government Land Scale (GLS) Program for the second half of the year 2010.This marks the highest potential supply in history of GLS program (twice yearly).Here now question arises, can government control high rising property prices?
Well the answer is not so simple, property trend is so rampant. After a long time, the market prices reached so high , making it difficult for both developers and buyers, but the Government have decided to overcome this new market price challenge ,by launching five new residential sites for private home seekers.
Singapore government, Urban Redevelopment Authority (URA) along with Housing and Development board (HDB) are handling the site sales and claims to provide more choices for developers and home buyers, in various locations across the island. More than 2,045 private homes are released for sale by the state. Governments confirmed list includes , Petir road site which is already launched ,its residential area resembles a concrete jungle, if not for the several small parks that were developed by URA,( having 2.4 ha gross area and maximum gross floor area is about 514,000 sq ft; Approximately 430 units can built on it), remaining four includes Alexander road , Tanah Merah Ketch ( west coast link and west coast crest) ,Pasir Ris road 3 and Elias road, which are now available for second half of GLS program. Applications are invited under GLS Program for second half of 2010. Under the reserve list system , an interested developer can submit an application along with minimum bid offer, if the price deemed acceptable, then the second option will be, sale by tender. The tender for the site closes at noon on October 7.
Different researchers expected fewer bids for all these sites, due to poverty market measures. Most of these sites are located in suburban areas, and people tend to like these residential areas. Due to high rise in market prices, developers and buyers are more selective now, but previous result shows a remarkable success and a lot of demand for new private sites.
But on other hand, RDA claims that the prices of private homes rose 11% between January and June. The Singapore Government seems highly interested in this private housing project. The minister of National development (MND) announced new measures to boost up public and private housing markets. The strategy of demand and supply is used by MND, as he said that, if strong demand continues a larger supply of private houses can be injected, in the first half of 2011 GLS program. MND also announced some changes in mortgage policy, from now people already having mortgage , or second home buyers can only borrow up to 70% of property’s value for second home, down from 80% previously, that must also pay 10%in cash , up from 5%.This demand side measure is just to cool the private housing market. Analyst appreciate MND’s statement and mark them as a milestone for future market in two ways; firstly it can reduce peoples anxiety ,by assuring them ,enough new sites for launch and secondly it can help in controlling high rise market prices. Analysts also claim that these areas will be more affordable than previous ones
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