Singapore has cued up the city-state’s biggest housing pipeline in more than a decade with the Urban Redevelopment Authority (URA) on Wednesday announcing plans to sell sites capable of yielding up to 5,450 new private homes during the first half of 2024.
The set of 10 projects is set to provide 5.6 percent more homes than the government land sale (GLS) programme for the second half of 2023, which had already broken a decade-old record.
With the upcoming programme representing the URA’s biggest bounty of new homes since the first half of 2013, per the agency’s announcement, the crescendoing supply is likely to lead to more cautious bidding from developers and could further cool home price growth according to Marcus Chu, chief executive officer of property agency ERA Singapore.
“This bumper supply of land will assure developers that there is ample land bank, and help regulate bids and land prices,” Chu said. “It also signals to homebuyers that the government is committed to ensuring sufficient supply to keep prices in check.”
Sites for All
With the government continuing its campaign to ensure housing affordability in Singapore, the GLS programme for the first half of 2024 includes 10 sites to be put up for tender during the period, including seven designated purely for development of private homes for sale.
Also on the list is a plot which combines private homes for sale with long-stay serviced apartments, a mixed commercial and residential site and one parcel dedicated to Singapore’s hybrid public-private executive condominium housing type.
Chu noted that with the government having increased the supply of residential land since a spike in housing prices during 2022, residential tenders during the second half of this year received an average 3.7 bids each, compared to 5.2 offers per site during the first half of 2022.
“We think the 1H 2024 supply is quite akin to a one-stop-shop for developers, offering a good spread of sites from prime areas to the suburbs, including many plots that are within walking distance to an MRT station (new or upcoming) – an attribute that is increasingly important to many home buyers these days,” said PropNex Realty CEO Ismail Gafoor,.
In its statement on Wednesday, the URA said that there is now a pipeline of 39,700 homes set to be completed from now through 2025, or nearly double the 20,000 homes built from 2020 to 2022.
Private home sales declined for the third month in a row during October, dipping by 6.5 percent to 203 units from the month prior and posting a sharper 35 percent drop when compared to the same period last year, latest URA data showed.
Average home prices across the city-state have also stagnated, inching up by 0.5 percent in the third quarter from the preceding three months, following a 0.2 percent decline in the second quarter.
Supporting Rental Market
After the URA last week unveiled its first two sites designated for development of long-term rental homes, a plot included in the agency’s upcoming programme prescribes development of 515 apartments for lease.
The site on Media Circle site within the One-North research and development hub in western Singapore will require that developers make the apartments available for lease as serviced residences with a minimum stay of three months. Gafoor of PropNex expects the plot to appeal primarily to hospitality players hoping to provide accommodation for workers in One-North, Singapore Science Park and the National University Hospital.
The URA last week opened bidding for the first two pilot sites with long-stay serviced apartment components, including a plot on Zion Road near the city centre and another on Upper Thomson Road in northern Singapore.