http://www.straitstimes.com/PrimeNew...ry_670512.html
May 20, 2011
Analysts expect shift in housing policy
By Esther Teo, Property Reporter
SOME property analysts are anticipating policy shifts on HDB flats and mass market private homes, with the appointment of Mr Khaw Boon Wan as the new National Development Minister.
They say Mr Khaw, 58, the outgoing Health Minister, is known to be an effective game changer.
Since housing affordability was a hot-button topic during the elections, the analysts foresee Mr Khaw as being forceful on this issue, at least early on.
Analysts note that Mr Khaw had volunteered for the portfolio, replacing Mr Mah Bow Tan, who is retiring from the Cabinet and the post he has held since 1999.
They recall Mr Khaw was parachuted into the Health Ministry after the 2003 Sars crisis. The well-liked politician was instrumental in restoring confidence in charities after the National Kidney Foundation scandal.
DMG & Partners Securities research co-head Terence Wong said he would not be surprised if Mr Khaw shows determination
to make housing more affordable for the young.
Mr Colin Tan, research and consultancy director at real estate firm Chesterton Suntec International, said Mr Khaw has his 'work cut out for him'.
'PM Lee did say that the changes will allow for a fresh slate that will look at everything from scratch, so it's possible that Mr Khaw will look towards reshaping and rethinking policies,' he added.
Industry players say, however, that while it is too soon to identify the changes Mr Khaw may make, his track record of working well under pressure and approachable public persona will stand him in good stead.
The Government may overhaul other policies - including its immigration policy - to prevent a further run-up in prices and to cater to the increasingly squeezed middle class, analysts say.
The aim will be to ensure prices rise - or fall - in line with general economic growth, with a focus on the HDB and mass market segments to ensure affordability for the masses, they add.
The Government had already pledged to review the $8,000 income ceiling for buying HDB flats - unchanged for the past 17 years for first-timers.
SLP International research head Nicholas Mak said, however, that the Government is unlikely to introduce sweeping measures that would cause a price slump as this would unfairly penalise sellers in the resale market.
However, it might look to bring down prices of new build-to-order HDB flats so as to draw demand away from the resale market and stem further price gains.
Last year, private home prices rocketed 17.6 per cent, while HDB resale prices surged 14.1 per cent, upsetting first-time home owners priced out of the market.
Chesterton's Mr Tan added that policies focused on helping the middle-income group satisfy their housing aspirations are also likely.
The Government has vowed to pay particular attention to the middle class as it represents 'mainstream Singapore'.
Property stocks have been weaker since news broke that the Government is reviewing the HDB income ceiling.
Counters like CapitaLand has lost 4.5 per cent since the May 3 announcement, while Keppel Land has dipped 3 per cent. While other factors could be in play, the Straits Times Index gained 0.6 per cent in the same period.