Property cooling steps working: Mah

[hyenergix]

Apr 3, 2011
Hopefully, the market will see a soft landing, says National Development Minister

By Huang Lijie

The recent housing price estimates by government agencies suggest that its property cooling measures are moving in the right direction.

National Development Minister Mah Bow Tan yesterday called the estimates 'quite encouraging' as they reflect moderation of price rises for both the public housing and private property markets.

He added that the Government is also starting to see a reduction in the volume of transactions and a continuing downward trend in cash-over-valuation (COV), or the median cash premium paid for a resale flat on top of its valuation.

He said that COV went from about $30,000 in the third quarter of last year to about $23,000 in the fourth quarter. And in the first quarter of this year, it was between $20,000 and $21,000.

He said: 'Hopefully, we will have a soft landing for prices. As I have said many times, we are not trying to crash the market. We are trying to achieve a soft landing for the market in keeping with the current economic fundamentals. That's beginning to happen.'

The estimates, released last Friday, showed that resale Housing Board (HDB) prices rose 1.6 per cent in the first quarter of the year compared to the previous quarter. This is the lowest quarterly increase since the second quarter of 2009.

Private property prices also rose a slower 2.1 per cent, compared to the previous quarter's 2.7 per cent increase. It is the sixth consecutive quarter of moderation in price growth for private homes.

Mr Mah added that he expects to see the full impact of the market cooling measures - the last of which was implemented in January - in another few months.

The new measures included lowering the amount banks can lend on a second mortgage from 70 per cent to 60 per cent of the home's value.
He was speaking on the sidelines of the completion ceremony for Parc Lumiere, the condo-style public flats built under the Housing Board's Design, Build and Sell Scheme.

Mr Mah also addressed the issue of how sky-high prices of mass-market private homes are putting pressure on flat owners to upgrade instead to Housing Board resale flats.

He said that with an increased supply of mass-market private homes being rolled out, including 33,000 private property units that have yet to be sold, he expects prices for these homes to moderate further.

He added that there may even be a slight oversupply in the housing landscape two to three years down the road. But the situation will be monitored carefully and government land sales adjusted to calibrate supply.

He reassured first-time flat buyers too that with a record number of 22,000 units planned for launch under the Housing Board's build-to-order scheme this year, there should be enough flats to meet demand.

He said there will be at least 10 build-to-order launches, each with about 70 blocks of flats, for the next two months.

'And beyond May, if the demand is still strong, we still have a lot of supply that is able to be pushed out.'

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'As I have said many times, we are not trying to crash the market. We are trying to achieve a soft landing for the market in keeping with the current economic fundamentals. That's beginning to happen.'
National Development Minister MAH BOW TAN

[hyenergix]

Even MBT acknowledge now that there might be slight oversupply in 2 years' time He can only control BTOs and GLS, but he cannot control pte enblocs, which are churning out MMs to flood the market. So double confirm oversupply by then. Double confirm!

[DaytonaSS]

He like soft landing so much, maybe pple will give him one lor

[ysyap]

It is quite irritating that his measures are coming to fruition NOW. Another successful stunt, the last one in 2005 just before election in 2006 when many unsold oversupply HDB flats were successfully offloaded in the walk-in-selection scheme. Now with record no. of BTO and ECs launches, positive results are showing again.

Not that I'm against the positive results but my point is this. There were already a lot of complaints some 2 years back when many newly weds lamented the lack of new HDB flats for them and re sale ones were too exp. In fact, the property market began its recovery in mid 2009 and prices were climbing very quickly. What happened then was only to introduce cooling measures (one after another) which were only targeted at discouraging investors to crowd the market but very little was done on the supply issue. HDB launches were slow. Even those that were launched like City View was priced at near condo prices then in 2008 and it didn't really appeal to those who could not afford. (on hind side, could build these flats in Seng Kang and Jurong then and surely it'll be at least 100k to 200k cheaper) These same folks also could not affort those expensive resale HDB . So... no choice but to watch prices continue to shoot north.

Then, as if in an attempt to rescue the market (that was already severely ill for 15 months), ECs were re-introduced late last year (eg. Esparina) to help middle class people who can't afford condo but don't qualify for HDB. This year, record no of BTOs to cater to the rest of the demand along with more ECs like Austville to continue to meet rising demands. No promises for 2012 yet.. Timing is just too coincidental for me to conveniently make such connections. Not to offend anybody.. solely my view point.

[linchong84]

It is quite irritating that his measures are coming to fruition NOW. Another successful stunt, the last one in 2005 just before election in 2006 when many unsold oversupply HDB flats were successfully offloaded in the walk-in-selection scheme. Now with record no. of BTO and ECs launches, positive results are showing again.

Not that I'm against the positive results but my point is this. There were already a lot of complaints some 2 years back when many newly weds lamented the lack of new HDB flats for them and re sale ones were too exp. In fact, the property market began its recovery in mid 2009 and prices were climbing very quickly. What happened then was only to introduce cooling measures (one after another) which were only targeted at discouraging investors to crowd the market but very little was done on the supply issue. HDB launches were slow. Even those that were launched like City View was priced at near condo prices then in 2008 and it didn't really appeal to those who could not afford. (on hind side, could build these flats in Seng Kang and Jurong then and surely it'll be at least 100k to 200k cheaper) These same folks also could not affort those expensive resale HDB . So... no choice but to watch prices continue to shoot north.

Then, as if in an attempt to rescue the market (that was already severely ill for 15 months), ECs were re-introduced late last year (eg. Esparina) to help middle class people who can't afford condo but don't qualify for HDB. This year, record no of BTOs to cater to the rest of the demand along with more ECs like Austville to continue to meet rising demands. No promises for 2012 yet.. Timing is just too coincidental for me to conveniently make such connections. Not to offend anybody.. solely my view point.

If there are no criminals, how would people know policemen are effective? If people don't experience suffering for 2-3 years, how would the people appreciate that the government has the power to alleviate their suffering? If government alleviate their suffering 2-3 years ago, everyone is happy, who will still bother to remember and appreciate the government's efforts today when election is coming? Everything happens for a reason, just be glad that the majority of people did not suffer and in fact most earn from the hike.

[wind30]

Everything happens for a reason, just be glad that the majority of people did not suffer and in fact most earn from the hike.

err... the market have not fall yet.... how to suffer?

We need to see what happens in 2 years time.

[rattydrama]

If there are no criminals, how would people know policemen are effective? If people don't experience suffering for 2-3 years, how would the people appreciate that the government has the power to alleviate their suffering? If government alleviate their suffering 2-3 years ago, everyone is happy, who will still bother to remember and appreciate the government's efforts today when election is coming? Everything happens for a reason, just be glad that the majority of people did not suffer and in fact most earn from the hike.

Err good planning and forecast should have less impact. There should be shared efforts amongst ministries.

[ysyap]

If there are no criminals, how would people know policemen are effective? If people don't experience suffering for 2-3 years, how would the people appreciate that the government has the power to alleviate their suffering? If government alleviate their suffering 2-3 years ago, everyone is happy, who will still bother to remember and appreciate the government's efforts today when election is coming? Everything happens for a reason, just be glad that the majority of people did not suffer and in fact most earn from the hike.

For every seller who earn from the hike, there must be a buyer who suffer from buying high so its 50-50, not really majority who benefited. Today, even when sellers want to sell high and continue benefiting from the price hikes, this same 'policemen' introduce so many complications to owning and buying of properties that buyers are less forthcoming so also difficult to benefit. So how is it that 'most earn from the hike'? Maybe only on paper which is totally useless unless they are 'forced' to sell at a loss... .
In fact no need voters to remember the good stuff they do over last 5 years before election. The govt can always publish these accomplishments and parade themselves as highly successful in their policies, etc. so can win more votes... no need to resort to last min attempts lah..

[devilplate]

last min attempts nothing wrong wat....most ppl r forgetful and near sighted wat.....

[ysyap]

last min attempts nothing wrong wat....most ppl r forgetful and near sighted wat.....

Yes yes nothing wrong.. in fact better than no attempts at all... its just irritating to see it so successful at the right time... hahaha!!!

[ay123]

tat short ass talk only. before jan measure he also said the last measure is working and need another few months to see the full impact. last then 1 month, jan measure came. now he said that AGAIN.....could it be.......

[devilplate]

tat short ass talk only. before jan measure he also said the last measure is working and need another few months to see the full impact. last then 1 month, jan measure came. now he said that AGAIN.....could it be.......

we will b shocked if he remove/adjust some measures instead.....haha

[avo7007]

There is a chance that the effects of current cooling measures will wear off by Q2. Just look at HK. There's simply too much liquidity in the market right now. It's like a Tsunami of money supply......flooding everything in it's path.

[ysyap]

tat short ass talk only. before jan measure he also said the last measure is working and need another few months to see the full impact. last then 1 month, jan measure came. now he said that AGAIN.....could it be.......

Think no more changes or new measures for the moment coz results are ok and prices are stabalizing. Won't want to introduce new stuff to upset this current positive just before the big poll day... Not sure after that though...

[DaytonaSS]

Think no more changes or new measures for the moment coz results are ok and prices are stabalizing. Won't want to introduce new stuff to upset this current positive just before the big poll day... Not sure after that though...

Saw a report earlier , with exception of 1998 . Property chong 10% after election on history.

[ysyap]

Saw a report earlier , with exception of 1998 . Property chong 10% after election on history.

Not sure about the accuracy of your report or did I misinterpret your words? 2 jan 1997 was the election and after that property prices shot real high, creating record prices that still stand today in CCR. Then in Nov 2001 next election, all went south coz it was just after 911. After that, asia was hit with its 2nd financial crisis after the first in 1998. Then May 2006 was the last election when the property market was climbing till it peaked in 2007 before a world wide financial crisis because of the US housing market. So technically it should be chiong after 1997 and 2006 election only. 2001 election probably did not result in any chiong in prices....Then again I might be wrong... just my estimate based on major events...

[DaytonaSS]

Not sure about the accuracy of your report or did I misinterpret your words? 2 jan 1997 was the election and after that property prices shot real high, creating record prices that still stand today in CCR. Then in Nov 2001 next election, all went south coz it was just after 911. After that, asia was hit with its 2nd financial crisis after the first in 1998. Then May 2006 was the last election when the property market was climbing till it peaked in 2007 before a world wide financial crisis because of the US housing market. So technically it should be chiong after 1997 and 2006 election only. 2001 election probably did not result in any chiong in prices....Then again I might be wrong... just my estimate based on major events...

let me see if i can find that report... saw it 2-3 months ago.... hope its still in my office lappy....

[devilplate]

i rem jlrx got a graph indicating every GE on the PPI.....its like 80% probability of ppty px increase after every GE

if GE held during a bullish period....vy high chance will chiong up after tat.....smthing like dat

[westman]

i rem jlrx got a graph indicating every GE on the PPI.....its like 80% probability of ppty px increase after every GE

if GE held during a bullish period....vy high chance will chiong up after tat.....smthing like dat

If happened, huatX3!

[dtrax]

Let me recap with the property timeline that jlrx like to used on his posting:

[kane]

speaking of jlrx, where is he? i like his ability to take our old classifieds and articles from the 80s.

[wenqing]

I do not believe GOOD NEWS just BEFORE elections.

I do not believe any news from government just BEFORE elections.

Property news occupy pages of newspaper everyday to save Mah Bow Tan.

He has been saying the market is cooling and cooled for almost a year.

Trust news from him at your own risk.

It is all about elections.

[romeo]

i think mbt is saving himself.. last desperate attempt to appease the voters

[devilplate]

i think mbt is saving himself.. last desperate attempt to appease the voters

can nvr please all voters

[linchong84]

i think mbt is saving himself.. last desperate attempt to appease the voters

He does not need to appease the voters.. He is in Tamp GRC.. Tamp is going to have its 4th big shopping centre and it is those big hub kind.. You tell me where else in suburban is there 4 big shopping centres stick together one? It is like a mini-orchard like that.. And it will have so many MRT stations in the next few years.. Property prices there also rising, make residents there happy.. His seat in Tamp is secured without a doubt..

[devilplate]

He does not need to appease the voters.. He is in Tamp GRC.. Tamp is going to have its 4th big shopping centre and it is those big hub kind.. You tell me where else in suburban is there 4 big shopping centres stick together one? It is like a mini-orchard like that.. And it will have so many MRT stations in the next few years.. Property prices there also rising, make residents there happy.. His seat in Tamp is secured without a doubt..

one thing vy strange...totally no condo near tamp mrt!! den pasir ris and simei full of condos

[linchong84]

one thing vy strange...totally no condo near tamp mrt!! den pasir ris and simei full of condos

EC coming up though haha.. If they launch a pte condo there, sure break record.. Tamp got too many good things to be true liao.. A bit kelong one.. Just like Tanjong Pagar got MM Lee so got Duxton this kind of once in a million kind of BTO.. So ideal thing is to live somewhere which has a big shot minister in charge..

[devilplate]

EC coming up though haha.. If they launch a pte condo there, sure break record.. Tamp got too many good things to be true liao.. A bit kelong one.. Just like Tanjong Pagar got MM Lee so got Duxton this kind of once in a million kind of BTO.. So ideal thing is to live somewhere which has a big shot minister in charge..

marine parade too