Tuesday, July 1, 2008
Citi sees no oversupply of homes in next two years -Straits Times - 26 Jun 2008
It estimates only 60% of the 30,000 units forecast will be completed..... Official figures show that around 30,000 homes will be completed in the next two years, but Citi reckons only around 60 per cent will likely be ready. ... This is because resale volumes are still at above average levels, reflecting strong genuine demand. There is no sign of overbuilding or an overall housing shortage.
Citi's argument is centred around the supply of private property. We should however not over look the supply of HDB flats which will have a great impact on the price of private property in the mass market.
On HDB supply, here's the report from HDB:
HDB plans to offer another 5,000 new flats under the BTO system over the next 6 months in towns such as Punggol, Sengkang, Woodlands and Bukit Panjang. The total planned BTO supply of 6,100 new flats for Jan-Sep 08 will surpass the number of BTO flats launched in the whole of 2007 (6,000 units) and 2006 (2,400 units). HDB will provide more details of the BTO flats when the projects are launched. Given that the construction of new BTO flats takes about 3 years to complete, buyers are advised to plan ahead for their housing needs.
This will add to more than 14,000 (6100+6000+2400=14,500) HDB flats, which most likely will be increased further with more demand, that will completed in the next 3 years. If prices of private property remain at the current high level, home buyers are likely to continue to go for HDB's BTO. As the government has said that they'd build according to the BTO demand, we may therefore continue to see increase supply in the HDB segment.
According to URA's data, we'd eventually see more than 65,000 private property units in 3 years time.
Add to the supply of private properties and HDB flats, the number of properties from the stream of enbloc sales in 2006-2007; we'll very well see more than 100,000 more housing units in the market within the next 3 years.
In a market like this, one just has to wait patiently.
May also want to read:
History of Singapore Property 1960 to 2008
Buy or Not Buy: How to decide amid mixed market signals
When to Buy, When Not to by
Property Price Index Graph Plotter & Online Property Valuation