More homes in the pipeline

The Housing and Development Board (HDB) and the Urban Redevelopment Authority (URA) yesterday launched four residential sites for sale by tender, adding almost 1,900 housing units to the increasing supply of homes.

Bidding for the sites is expected to be cautious as the private property market has been showing signs of cooling in recent months and as the external economic environment becomes increasingly uncertain amid the debt crisis in Europe and weak recovery in the United States.

Mr Mohamed Ismail, the chief executive of property consultancy Propnex, said: “Certainly, developers will exercise greater caution for both the HDB and URA sites because of the current property market sentiment as well as the global economic crisis.”

Of the sites being offered, Mr Ismail believes the HDB ones, which will be developed into executive condominiums, will be more popular. This is because the increased income ceiling – to S$12,000 from S$10,000 previously – and tiered CPF housing grants of as high as S$30,000 announced on Aug 15 by HDB will be applicable to these two sites.

The EC sites will be at Yishun Avenue 7/Canberra Drive and Pasir Ris Drive 3/Pasir Ris Rise.

The Yishun site has a land area of around 27,000 square metres and can potentially yield about 725 housing units, while the site at Pasir Ris has an area of around 18,500 sq m and can yield about 390 housing units.

Mr Ismail expects these sites to attract bids of about S$300 per sq ft per plot ratio (psf ppr). This works out to an average selling price of S$700 per square foot for the units.

The URA sites – launched under the Confirmed List of the second half of 2011 Government Land Sales Programme – are at Jalan Loyang Besar/Pasir Ris and Flora Drive.

The land parcel at Jalan Loyang Besar has an area of 17,000 sq m and can potentially yield 355 units. Meanwhile, the site at Flora Drive has an area of about 30,000 sq m and can yield about 415 housing units.

Mr Nicholas Mak, research head at real estate consultancy SLP International, said the renewed interest in ECs could come at the expense of HDB resale flats and the private mass market segment. He estimates that the Jalan Loyang Besar site could fetch bids of about S$420 to S$460 psf ppr in today’s market and the Flora Drive site at around S$300 to S$350 psf ppr.

Source : Today – 26 Aug 2011

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