Years to correct supply-demand imbalance for HDB flats: Khaw
24 July 2011
SINGAPORE: National Development Minister Khaw Boon Wan said it will take 3 to 5 years to "substantively resolve" the problem of high resale flat prices and for prices to stabilise.
He said there is currently an imbalance between supply and demand - and new Build-To-Order (BTO) flats take three years to build.
Mr Khaw said this in response to questions from reporters on the sidelines of a community event on Sunday.
He also expressed confidence that resale flat prices will stabilise but stressed that the problem of high prices cannot be solved overnight. He urged Singaporeans to be patient.
On Friday, figures from the HDB showed prices rising by 3.1 per cent in the second quarter of this year, nearly twice the previous quarter's 1.6 per cent.
"Why do prices go up? It's very simple, because there's an imbalance in supply and demand. Supply means... build more. (But) you won't see the flat until three years later. New housing plans will have effect on the resale market. So the more I push out, I'm sure there's some influence," said Mr Khaw.
On the demand side, Mr Khaw advised young couples who have a place to stay in currently, not to get too excited and jump into the resale market. Instead, they should continue to apply for a BTO flat. He also urged upgraders who already own a flat to hold off on their plans, so as not to crowd the market.
Mr Khaw added that the property cooling measures implemented by the government have reduced unnecessary demand stemming from speculation.
Mr Khaw also explained why the HDB stopped releasing the median Cash-Over-Valuation (COV). The minister said the figure is "misleading" and cannot be used to judge if COV has gone up or come down.
He added that the median figure is dependent on the house type and location of flats that are sold, which can change from month to month.
Instead, the HDB will continue to offer a breakdown of COV according to location and house type, which Mr Khaw said, is the information Singaporeans need when they decide on whether to buy a home.
The golden question is why is there such imbalance now?
The answer is simple, it was done purposely to inflate the price so the government can maximised the profit.
Remember the ex-Minister for National Development who keep telling Singaporean we have enough flats?
Also the influx of Foreigner also adds on to the problem.
Then shouldn’t the million dollar Men In White do a simple math that if you keep increasing the population and not building enough flats you will have a shortage like now?
Well guess they did but were bochap but now they start to chap because they lost a few seats in the last election.
So this is a case of the Men In Whites putting themselves first before you and me as I am pretty sure they know the number of flats there will be in 2010 but as I’ve mentioned they just want to sell it at a higher price.
But they failed to realised that Singaporean will get impatient and shown their un-happiness in votes.
So Minister Khaw is tasked to be Mr Nice guy to clean up after the horse which screwed up but still taking his pension and $16,000 per month of tax payers money.
Good life indeed.