Developers' worries about oversupply remain: Redas

Real Estate Developers' Association of Singapore (Redas) president Chia Ngiang Hong (from left), Minister for National Development Lawrence Wong, Redas past president Augustine Tan, Ministry of Law deputy secretary Calvin Phua and Inland Revenue Auth
Real Estate Developers' Association of Singapore (Redas) president Chia Ngiang Hong (from left), Minister for National Development Lawrence Wong, Redas past president Augustine Tan, Ministry of Law deputy secretary Calvin Phua and Inland Revenue Authority of Singapore chief executive Ng Wai Choong tossing yusheng at the Redas Spring Festival lunch yesterday.ST PHOTO: KELLY HUI

Meanwhile, Lawrence Wong says he welcomes partnerships in revitalising existing spaces

Even as the private residential market appears to be stabilising in line with economic fundamentals, developers' concerns over the upcoming supply and build-up of unsold inventory remain, Real Estate Developers' Association of Singapore (Redas) president Chia Ngiang Hong said.

"Although new home sales seem resilient, sales performance across the different projects and segments are uneven," he said at Redas' annual Spring Festival lunch yesterday.

Nonetheless, Singapore's private residential property market remained resilient last year, he said.

Despite the cooling measures and economic headwinds, 52 new projects, excluding executive condominiums, with about 17,000 units were put up for sale. More than 9,900 new homes were sold, 12.7 per cent higher than in 2018.

This year, more than 30 projects with 9,000 new units may be up for sale, and about half of the new launches will be in the core central region, he said.

In the beginning of the year, most analysts expect new home sales for this year to remain resilient and roughly match the 2019 level, while prices are expected to be steady, Mr Chia said.

Analysts expect demand for private homes from Housing Board upgraders to remain steady this year on the back of 26,100 HDB flats reaching the minimum occupation period. That is 50 per cent higher compared with the past five years' average.

There is also a great deal of pent-up household liquidity, Mr Chia added. The number of millionaires and ultra-high-net-worth individuals worldwide will also grow markedly over the next few years, especially in India, China and the Asia-Pacific region, and foreigners continue to view Singapore's private residential property favourably.

In addition, Mr Chia noted that new decentralised growth centres and areas outside the Central Business District (CBD) are being planned and developed, while the central area is incentivised for rejuvenation and redevelopment through the CBD and Strategic Development Incentive (SDI) schemes.

 
 
 

Under the SDI scheme, owners of adjacent commercial or mixed-use developments in "strategic" areas (especially Orchard Road, the CBD and Marina Centre) may join forces and come up with redevelopments that transform the locale.

Speaking at the event yesterday, National Development Minister Lawrence Wong said he welcomed partnerships in revitalising and rejuvenating existing spaces.

"We have done Business Improvement Districts - there are 10 pilots now undertaken by the private sector across 10 precincts. There has been good progress...

"We introduced the CBD Incentive Scheme as well as the (SDI) Scheme to encourage commercial building owners to redevelop their properties. Again, there has been strong interest from many developers," Mr Wong said.

A version of this article appeared in the print edition of The Straits Times on February 01, 2020, with the headline 'Developers' worries about oversupply remain: Redas'. Print Edition | Subscribe