Source : Business Times - 7 Nov 2008
WE thank Ee Teck Siew for his letter ‘Government should leave land prices to market forces’ and Adrian Ho for his letter ‘Government should not help developers’ (BT, Nov 4, 2008).
Both writers referred to the Oct 31, 2008 announcement by the Ministry of National Development to transfer most of the remaining Confirmed List sites in 2008 to the Reserve List and to suspend the Confirmed List for the first half 2009 Government Land Sales Programme.
The government’s decision to transfer most of the sites onto the Reserve List is not aimed at cutting off land supply to prop up prices or rentals. Rather, given the uncertain economic outlook, we have transferred the sites to the Reserve List so that these sites continue to be made available for sale, but we allow the market the flexibility to respond to changes in the economic outlook and adjust the supply of land accordingly. Developers can bid for sites in the Reserve List at any time. This market-led approach under the Reserve List system, where sites are released for sale only if there is genuine demand, would allow prices to adjust accordingly and find a level that best reflects the prevailing market conditions.
In deciding to transfer the sites to the Reserve List, the government has also assessed that there is an adequate supply of private residential units and commercial space from projects in the pipeline to meet the needs of population and economic growth over the next few years.
We thank Mr Ee and Mr Ho for their feedback.
Lim Yuin Chien
Deputy Director (Corporate Communications)
for Permanent Secretary
Ministry of National Development
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