Government keeps 1H2018 GLS supply unchanged from 2H2017

/ EdgeProp
December 13, 2017 3:32 PM SGT
The government has decided to keep the total supply of units for 1H2018 at about the same level as the supply of units from the 2H2017 GLS Programme, says the Ministry of National Development (MND) when it announced the 1H2018 Government Land Sales (GLS) Programme on Dec 13.
The 1H2018 GLS Programme comprises six Confirmed List sites and nine Reserve List sites. In total, the sites can yield about 8,045 private residential units and 63,960 sq m gross floor area (GFA) of commercial space.
According to MND, the government has taken into consideration several factors in determining the supply. While there is strong demand for sites from real estate developers and a pickup in transaction volumes, there is a large potential supply of around 20,000 units from collective sales and GLS sites that have not yet been granted planning approval, says MND. This is on top of about 18,000 unsold units that already have planning approval. And more than 30,000 existing private housing units remain vacant, it adds.
Including the units from the 1H2018 GLS Programme, the total supply in the pipeline will be adequate to meet the demand from homebuyers over the next one to two years, says MND. “When these are completed, the overall stock of private housing will be more than sufficient to meet Singaporeans’ housing needs.”
According to Lee Nai Jia, head of research at Edmund Tie & Company (ET&Co), the 1H2018 GLS Programme signals the government’s intention to maintain a stable market. “The measured approach will reduce the likelihood of an oversupply situation two to three years down the road.”
The 1H2018 Programme provides varied options for developers in suburban, city fringe and prime locations, and complements offerings on the collective sale market, says Tricia Song, director and head of research at Colliers International.
Among the six sites on the Confirmed List, the 0.57ha site at Cuscaden Road, which can yield an estimated 170 units, and the 0.62ha site at Mattar Road, which can accommodate about 250 units, should be more popular with developers, given their location and size, says ET&Co’s Lee. He expects bids ranging from $1,600 to $1,750 psf per plot ratio (ppr) for the Cuscaden Road land parcel, and the Mattar Road site to be sold at $1,200 to $1,400 psf ppr.
The Mattar Road site is close to the Mattar MRT station on the Downtown Line and there is “limited competitive...