Mr Wong Heang Fine, President of REDAS
Ladies and gentlemen
MAINTAINING A STABLE AND SUSTAINABLE HOUSING MARKET IN SINGAPORE
1. Good evening.
2. I am pleased to join you in celebrating the 52nd anniversary of the Real Estate Developers’ Association.
Diverse views on recent measures
3. Earlier this month, the Government announced the Additional Buyers’ Stamp Duty to moderate investment demand in the residential property market. The announcement has generated much public discussion with many diverse views.
4. Such diversity of views is natural and not unexpected. It reflects the fact that the property market involves many stakeholders, including home owners, investors, developers and the wider public, with many different interests and perspectives.
Common interest for a stable and sustainable property market
5. Yet, I think many of us would agree that it is in our common interest to have a sustainable and stable property market in Singapore. Excessive volatility in residential property market has adverse implications on all stakeholders, our economy and society.
6. This is why the government has since 2009 introduced four rounds of measures to cool our property market. And notwithstanding the uncertain economic environment, investment demand, particularly from overseas, has remained robust. Given volatile equity markets and a worsening economic situation in Europe, our small property market is attractive to foreign funds. The latest measure is a targeted and measured move to moderate such investment demand in order to avoid the need for a major correction down the road. I don’t expect developers to welcome such a move. But I seek their understanding that this will ultimately be good for the industry.
Enhancing home ownership for Singaporeans
7. Beyond these demand cooling measures, the Government has committed to expand supply through our Government Land Sales (GLS) programme to meet the strong demand for private housing. For 1H2012 GLS Programme, we have injected sites that can potentially yield a total of 14,100 units. Our GLS programme is reviewed every six months to balance housing demand and supply, as well as overall market conditions.
8. We have also taken another step to expand opportunities for higher income Singaporeans to own private housing by expanding the Executive Condominium (EC) market. The EC scheme was introduced in 1995 to provide a more affordable private housing option for Singaporeans. Since the introduction of the scheme, 14,600 EC units have been launched by developers and 3,000 units are coming on-stream.
9. To help more Singaporeans own private condominiums, we have recently expanded the EC scheme in two ways. First, we raised the monthly income ceiling for the purchase of new ECs, from $10,000 to $12,000 in August this year. The increased income ceiling has already benefitted around 220 households who have booked their ECs after August. Second, we are expanding the EC supply and are prepared to supply land sites for 5,000 EC units in 2012.
10. Notwithstanding the expanded supply of private and EC housing, the majority of Singaporeans has and will continue to live in public housing. We are committed especially to help first timer newlyweds purchase their own homes. We have increased the income ceiling for BTO flats and ramped up the building programme for new HDB flats. HDB launched 25,000 BTO flats in 2011, and will be launching another 25,000 BTO flats in 2012. This ensures an adequate supply of affordable housing to meet first-timer newlyweds’ housing needs. Feedback from newlyweds has been very positive. Next year, we can begin to pay more attention on helping the HDB second-timers.
11. Given more subdued growth prospects globally and in Singapore, I would like to take this opportunity to remind Singaporean buyers to be prudent when shopping for their new residential property. The current low interest rates have enhanced the affordability of housing. But such low rates are not the ‘new normal’ and will eventually rise. Buyers need to do their sums and be careful not to over-commit themselves in their borrowing for property purchases. Buy within your means. We have a wide range of housing options to cater to your different needs and budget.
12. In closing, 2011 has been an eventful year for the property market, and I hope 2012 will see our residential property market returning to a stable and sustainable path. I would also like to acknowledge and express my appreciation to REDAS and all our partners here in the audience for helping to build Singapore as an attractive home and a global city. And although the Government may not be able to consult REDAS on every issue, especially those that are market-sensitive, there are many areas of mutual interest which we are happy to engage in closer dialogue on.
13. On this note, I would like to wish you good health and happiness in the coming year. Thank you.