Developers seen tapering bids as gov’t bumps up land sales programme

Sites up for sale include seven private residential sites, an EC plot, a long-stay serviced apartments site and a mixed-use one.

Developers are expected to become less aggressive in bidding for the 10 government land sales (GLS) scheduled for launch in the first half of next year, according to property analysts.

The latest GLS programme is unlikely to have an immediate impact on private home prices since the projects will only hit the market in 2026, said Wong Xian Yang, research for Singapore and Southeast Asia at Cushman & Wakefield.

The expanded pool of sites, however, will help temper demand from both builders and homebuyers to keep the housing market stable.

“With more launches coming on stream, buyers would remain selective and quantum sensitive given still-high interest rates. As such, developers would be strategic about their bids and could focus on small to medium sized sites with low levels of future market competition,” Wong said.

Ismail Gafoor, CEO of PropNex Realty, noted that the ongoing market uncertainties have already dampened developers’ appetite for GLS sites, and the increased land supply next year will further help moderate bids.

“That being said, we had hoped that the government would place at least one more EC site on the Confirmed List, as such housing type is extremely popular with buyers,” Gafoor said.

The Ministry of National Development on Wednesday revealed the GLS programme for 1H2024 will consist of seven private residential sites, an EC plot, a long-stay serviced apartments site and a mixed-use plot that could yield a total of 5,450 units when developed, up 5.6% from the 5,160 buildable homes under the GLS list in 2H2023.

After increasing the land supply over the past three and a half years straight, CBRE Singapore research head Tricia Song said the current supply to “provide ample future landbanking opportunities for developers, and satisfy the resilient demand and hopefully stabilise prices.”

“They (eight new sites on the Confirmed List) are well spread-out and most are near MRT stations. We find the most attractive sites to be Margaret Drive site, River Valley Green and Jalan Loyang Besar EC,” Song said.

For Leonard Tay, Knight Frank’s research head, developers’ participation in the GLS tenders over the past six months have already been sliding markedly, in large part due to the substantial development risks they are facing currently.

“With no commercial sites on the confirmed list with the exception of the mixed residential/retail parcel at Tampines Street 94, perhaps the government reckons that there is enough new office supply islandwide, and more specifically in the CBD,” Tay added.

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