In the previous financial year ended March 2009, government land sales revenue dropped by 41 percent to S$7.3 billion.
However, according to several analysts, land prices have in fact grown 30 percent within the last six months despite the drop for the full year. It also created concerns which might further the property bubble in the market.
With more released plots for tenders since April 2009, demand for land has been revived.
Analysts hope that by 2010, demand for land will grow on the back of developers seeking to upgrade their land bank and in a more positive market sentiment.
According to market observers, in Q1 next year, the government can release additional strategic sites at Rochor/Ophir Road, Kallang Waterfront and Jurong Lake District. More land will be released to the market when the government gets hold of the sites’ Confirmed List in the first half of 2010.
Based on market watchers, in the present fiscal year to March 2010, the net effect is that sales revenues will likely remain about S$7 billion. Observers also added that revenues will also be boosted through increasing land prices.
Lately, one residential site at Avenue 3 in Serangoon had been sold for S$221 million.
"I was a bit surprised at the bidding for Serangoon. I think the top bid was 10 to 11 per cent higher than the second bidder. One would expect more cautious bidding in view of the current market and stock market conditions have started to come down. But I think by and large, it is a vouch of confidence in the Singapore residential market," said Cushman & Wakefield Managing Director Donald Han.
More measures are needed to control the property market, said analysts.
"I think the set of measures they announced recently were to curb speculation but this excess liquidity is not speculation. It is investment, so this is lots of money trying to find a more productive use. So maybe a different set of measures may need to combat this excess liquidity," said, Colin Tan, Director, Chesterton Suntec International’s Head of Research & Consultancy.