National Development Minister Mah Bow Tan said in Parliament yesterday that measures taken to cool the private property market seemed to have been effective.

He noted that the monthly data of the Urban Redevelopment Authority (URA) showed that private residential property sales of developers plummeted month-on-month by 37 percent in September, and by another 29 percent in October.

This was attributed mainly to the interest-only loans scheme in September and the removal of the interest-absorption scheme.

He also noted that the Ministry of National Development’s (MND) reinstatement of land sales of eight residential sites included on the confirmed list was another factor. This signifies that the government intends to maintain the affordability of private homes.

The list was suspended by MND last month as the property market weakened. However, MND recently decided to reinstate it as prices and demand for private homes began to surge again.

According to Mr. Mah, these eight sites can hold around 2,900 units. He added that another 18 sites were placed on the reserve list. Overall, these sites can generate around 10,600 units – the highest figure for any half-yearly Government Land Sales Program since 2001, when the reserve list system began. 

Mr. Mah said that the build-to-order supply was increased to 5,000 flats in Q4 of this year, in order to meet the demand for HDB flats.

"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,” he said.

“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.”

He also predicted that HDB will need to offer around 10,000 to 12,000 new flats each year for the next five years to meet the housing demand in Singapore.

“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,” Mr. Mah explained as he addressed a question raised by Mr Chiam See Tong regarding construction costs.

He also reminded the House that HDB does not price its flats based on a cost-plus-profit.