Large fresh batches of completed homes will be entering the market next year, which may in turn increase the supply of available private homes and decrease consumer’s demand. Add the Federal Reserve’s rate hike which was just announced yesterday, the market is expected to remain quiet in 2016. The authorities are picking up on these changes and have announced that they will be holding back on the release of land sites for sale in the first half of 2016.
As most of the completed new private homes flooding the market next year will be outside the central regions, that is 55% in the suburbs, suburban private properties might be feeling the crunch in terms of rental competition and sales volume. The total number of private homes reaching completion next year will be a whooping 22,351. Property experts’ have previously projected the market requirement of only 8,000 to 10,000 new units per year. The numbers have almost doubled over the last 4 years, with a total of 70,000 private homes were launched within this time period. Add public housing and the numbers are substantial reason for worry.
Although the government will still keep the Government Land Sales (GLS) programme going in order to keep the property and construction industry going, they will only be releasing 16 sites in the H1 of 2016. Some of the confirmed sites include a residential site in Sembawang, an executive condominium (EC) plot in Anchorvale Lane which may yield 640 units, a mixed-use plot in Bukit Batok West and a rare plot on Martin Place near River Valley road. The last of the 4 confirmed sites may be of particular interest to developers hoping to snag a prime plot which could yield potential high-end residential units.