Responding to the strong demand for private housing and land for private residential developments, the Ministry of National Development last week released its “highest potential supply quantum” per half year since 2001.
Comments from the industry suggest they expect the impact of this strong signal to be immediate, in terms of cooling home sales and dampening land bids.
Well, the experts have been swiftly proven wrong.
The first tender to close thereafter saw a record price for Executive Condominium (EC) land. The level of interest has also not waned. The number of bids – seven – was about on par with recent tender exercises for EC and Design, Build and Sell Scheme sites.
Just how large is the newly-announced housing land supply? Assuming developers do not trigger any sites from the reserve list for the second half of the year, the estimated 8,135 private homes from the confirmed list sites for the second half is only 30 per cent more than the actual first-half supply (including triggered sites).
Given that demand from developers has been enthusiastic, a 30-per-cent growth rate for the next six months may not be too unreasonable.
At the same time, it might be necessary to close the tenders for the next few sites at the same time, to thwart further rises in land prices.
If it is not a big problem for developers to absorb the increased supply, what about the demand side? Will there be enough buyers?
Yes, if the results of a recent property survey are to be believed. The survey with a sample size of more than 2,200 people found that three out of four potential home-buyers feel that the prices of private homes and resale Housing and Development Board (HDB) flats in Singapore are too high.
I think most of us know that already, but wait for this: Out of a sub-set of 657 active property seekers, 75 per cent still hope to buy a home within the next two years. They constitute 22 per cent of the total sample size. And this after saying in the same survey that they expect HDB resale prices and private property prices to rise between 6 and 10 per cent over the coming year. The survey was conducted last month and this month – after two sets of cooling measures were already introduced.
Last year, we had about 1.1 million households in Singapore. If we apply the 22-per-cent finding, this means there would be 242,000 households actively seeking to buy a property within the next two years. That is a lot of buying potential. Even if we were to take just one-fifth of this to allow for a very high margin of error, that is still 48,400 households.
This is the conundrum facing the Singapore housing market – the liquidity problem. Potential buyers know that housing prices are high but are still intent on buying. Developers sense this even if they cannot quantify it.
The trick is to turn things around fast, from land award to securing a sales licence before any correction can take place. The only crucial factor is whether the downpayment is affordable: If this cannot be done, throw in branded furnishings. Which tenant can resist such fine living?
As one property consultant noted: The bullish demand is largely driven by sentiment rather than a supply shortage. Quite right, as most buyers are investment driven, not need-driven.
Will it all come to grief eventually? You do the math. The capacity to occupy the homes is only 8,700 units per annum (average for past decade). The land supply for this year will be at least 14,400 units. The remaining owners will have to find other better uses for their homes when completed.
Source : Today – 28 May 2010
Friday, May 28, 2010
Thursday, May 27, 2010
Concept Plan 2011 - A chance for real, lasting change
Concept Plan 2011 may sound like yet another bureaucratic exercise that will produce another paper to be filed away – and many people have simply ignored it. Past history shows that Concept Plans can actually be a big deal, though.
Just look back a few decades. Minister for National Development Mah Bow Tan said recently: “In the first Concept Plan in 1971, we drew up plans for major infrastructure projects such as Changi Airport and our first MRT lines.”
Two decades later, “in the 1991 Concept Plan, we systematically planned for the decentralisation of commercial space from the CBD”, he added.
Recommendations in those two Concept Plans have radically transformed Singapore.
A further two decades on, it may now be the right time for another radical change. This time, though, the initial recommendations announced early this month make it seem like Concept Plan 2011 could focus as much on the softer side of Singapore’s soul as on infrastructure.
It has the potential to catalyse far-reaching changes that could create a more vibrant place to live. To make a real difference, though, three unpolished gems amid the concepts floated so far may need a lot more polishing to make a real difference.
One of those gems is – as the focus group said – that the city needs buzz. With only 43 per cent of respondents in the Urban Redevelopment Authority’s 2009 Lifestyle Survey saying they are satisfied with night-time activities and events here, many Singaporeans seem to agree. The recent CB Richard Ellis study showing that Singapore had dropped to 11th place for cities where top world retailers are located reaffirms the need for vibrancy.
Yet much more than closing downtown streets on weekends and putting art on the streets is needed. Renowned researcher Richard Florida says that knowledge workers prefer things like a “vibrant music scene, outdoor restaurants, organic supermarkets, juice bars”, rather than “passive cultural amenities” and “big-ticket items”.
Innovative ideas for more far-reaching concepts – from edgier entertainment to entirely new models for restaurants and retailers – may need to become key parts of the mix.
A second gem involved concepts for buildings that included recommendations for changes such as organic growth in “distinctive neighbourhoods” like Bugis or Little India, and space for inter-generational bonding.
All are good concepts. Again, more transformational changes than tweaks to HDB flats may be needed to bridge the generational and diversity divides.
In one of his books Harvard professor Robert Putnam cites a dozen success stories – such as the Chicago public library branches that have become vital locations for building social connections – as examples of how to build social capital. Multi-cultural multi-ethnic Singapore may have even more opportunities than the United States, and out-of-the-box thinking could create new concepts that better connect this diversity of people.
The concept of diversity, too, could be expanded to refer to anything from art havens to lifestyle choices.
And third, the focus group recommended environmentally-friendly projects ranging from bike lanes and better public transport to creating a Heritage Charter to preserve historic buildings. But rather than just pulling down old buildings or clearing away parks to make way for the new, co-chairman Lee Tzu Yang said it is important to “try and build a consensus among all the stakeholders in a particular district as to how to cherish, safeguard the things we love”.
These ideas are good too, yet, as reporter Ong Dai Lin noted in Today’s coverage of the Concept Plan 2011, “their suggestions echoed popular calls that have been rejected time and again”. More transformative projects, perhaps something like solar panels on the roof of every public building to make Singapore a world model for alternative energy, could offer changes that remake Singapore.
This once-in-two-decades chance to transform Singapore through the Concept Plan seems too important to ignore. What may be needed to propel Singapore forward is more input from more people and truly innovative ideas for creating vibrancy or improving fundamental policies.
While small focus groups and lightly-publicised requests for feedback that drew a few thousand responses are a start, only around 0.1 per cent of the population has provided input on what could truly be a plan to reinvent Singapore yet again. Now is the time to put the power of many more people to work.
Source : Today – 27 May 2010
Just look back a few decades. Minister for National Development Mah Bow Tan said recently: “In the first Concept Plan in 1971, we drew up plans for major infrastructure projects such as Changi Airport and our first MRT lines.”
Two decades later, “in the 1991 Concept Plan, we systematically planned for the decentralisation of commercial space from the CBD”, he added.
Recommendations in those two Concept Plans have radically transformed Singapore.
A further two decades on, it may now be the right time for another radical change. This time, though, the initial recommendations announced early this month make it seem like Concept Plan 2011 could focus as much on the softer side of Singapore’s soul as on infrastructure.
It has the potential to catalyse far-reaching changes that could create a more vibrant place to live. To make a real difference, though, three unpolished gems amid the concepts floated so far may need a lot more polishing to make a real difference.
One of those gems is – as the focus group said – that the city needs buzz. With only 43 per cent of respondents in the Urban Redevelopment Authority’s 2009 Lifestyle Survey saying they are satisfied with night-time activities and events here, many Singaporeans seem to agree. The recent CB Richard Ellis study showing that Singapore had dropped to 11th place for cities where top world retailers are located reaffirms the need for vibrancy.
Yet much more than closing downtown streets on weekends and putting art on the streets is needed. Renowned researcher Richard Florida says that knowledge workers prefer things like a “vibrant music scene, outdoor restaurants, organic supermarkets, juice bars”, rather than “passive cultural amenities” and “big-ticket items”.
Innovative ideas for more far-reaching concepts – from edgier entertainment to entirely new models for restaurants and retailers – may need to become key parts of the mix.
A second gem involved concepts for buildings that included recommendations for changes such as organic growth in “distinctive neighbourhoods” like Bugis or Little India, and space for inter-generational bonding.
All are good concepts. Again, more transformational changes than tweaks to HDB flats may be needed to bridge the generational and diversity divides.
In one of his books Harvard professor Robert Putnam cites a dozen success stories – such as the Chicago public library branches that have become vital locations for building social connections – as examples of how to build social capital. Multi-cultural multi-ethnic Singapore may have even more opportunities than the United States, and out-of-the-box thinking could create new concepts that better connect this diversity of people.
The concept of diversity, too, could be expanded to refer to anything from art havens to lifestyle choices.
And third, the focus group recommended environmentally-friendly projects ranging from bike lanes and better public transport to creating a Heritage Charter to preserve historic buildings. But rather than just pulling down old buildings or clearing away parks to make way for the new, co-chairman Lee Tzu Yang said it is important to “try and build a consensus among all the stakeholders in a particular district as to how to cherish, safeguard the things we love”.
These ideas are good too, yet, as reporter Ong Dai Lin noted in Today’s coverage of the Concept Plan 2011, “their suggestions echoed popular calls that have been rejected time and again”. More transformative projects, perhaps something like solar panels on the roof of every public building to make Singapore a world model for alternative energy, could offer changes that remake Singapore.
This once-in-two-decades chance to transform Singapore through the Concept Plan seems too important to ignore. What may be needed to propel Singapore forward is more input from more people and truly innovative ideas for creating vibrancy or improving fundamental policies.
While small focus groups and lightly-publicised requests for feedback that drew a few thousand responses are a start, only around 0.1 per cent of the population has provided input on what could truly be a plan to reinvent Singapore yet again. Now is the time to put the power of many more people to work.
Source : Today – 27 May 2010
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