By Rachel Chan

MEASURES that were taken to cool the private property market appear to have worked, said National Development Minister Mah Bow Tan in Parliament yesterday, underlining what many analysts had already concluded.

He noted that the Urban Redevelopment Authority's monthly data showed that sales of private residential properties by developers fell month-on-month by 37 per cent in September, and by a further 29 per cent last month.

He attributed this, in the first instance, to the removal of the interest-absorption scheme and the interest-only loans scheme in September.

A third reason, he noted, was that the Ministry of National Development (MND) had reinstated land sales of eight residential sites on the confirmed list, scheduled for the first half of next year. This was a further signal that the Government intended to keep private homes affordable.

MND had suspended the list in October last year as the property market weakened, but recently decided to reinstate it as private-home demand and prices surged again.

These eight sites can hold an estimated 2,900 units, Mr Mah said. Another 18 sites have been put on the reserve list, he added, and all together, these sites can generate about 10,600 units - the highest from any half-yearly Government Land Sales Programme since the reserve list system started in 2001.

On meeting the demand for Housing Board flats, Mr Mah said that the build-to-order supply has been increased to 5,000 flats in the last quarter of this year.

He said: "If we include the recent sale of balance flats last month, HDB would have offered over 7,000 flats in three months, and a total of 13,500 flats this year.

"This is about half the number of flats in Bukit Panjang or Pasir Ris town. At this rate, HDB would have offered enough flats to fill another Bukit Panjang or Pasir Ris in just two years."

Mr Mah offered this projection:

"In the next five years, HDB estimates that it will need to offer between 10,000 and 12,000 new flats per year to meet demand."

Addressing a question by Mr Chiam See Tong on construction costs, he said that "the total cost of building flats varies based on when we build, where we build and what we build... It varies from $230,000 for a three-room flat in Punggol to $530,000 for a five-room flat in Tiong Bahru".

HDB does not price its flats on a cost-plus-profit basis, he reminded the House.

Taken together with the additional housing grant, which varies from $5,000 to $40,000, buyers on average enjoy subsidies amounting to about 20 per cent of the market price of a four-room flat.

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