Following the government’s increased supply of new executive condominium (EC) sites, the market could see an oversupply situation, reported The Business Times.
Between the first half of 2010 and second half of 2012, 25 EC sites were released under the confirmed and reserve lists through the Government Land Sales (GLS) programme. This year, 11 sites were placed on the confirmed list but one site was moved from the reserve list in 1H2012 to the confirmed list in 2H2012. The site at Upper Serangoon View is being developed into Heron Bay (pictured).
Of the remaining 10 EC sites, five have been sold and are waiting to be launched, while the other five are either waiting for the tender period to close or have not yet been put up for sale under the GLS programme.
The 10 sites are expected to yield around 5,600 units by 2013, translating to an average annual supply of 4,500 units, said Ong Teck Hui, National Director for Research and Consultancy at Jones Lang LaSalle (JLL).
In comparison, the average annual supply over the past two years was about 3,600 units, while average take-up stands at 3,300.
“Viewed from this perspective, the oncoming supply is at a faster rate than the past. Assuming demand remains stable, the projects being marketed would face greater competition,” Ong said.
“It’s likely to be more of a buyer’s market given the wide range of projects coming on stream with the possibility of prices being more competitive.”
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