5 things to know about Government Land Sales (GLS) in 1H2018

(Credits)

The news is out on Government Land Sales (GLS), for the first half of 2018. A lot of eager eyes were on this, due to the recent en-bloc craze. As it turns out though, the government has neither capitalised on rich foreign developers, nor taken steps to rein them in. The strategy seems to be a well-considered “wait and see” stance… for now. Here are the five most interesting details:

1. There’s no real increase or decrease in land sales, as compared to last year

The GLS programme for 1H2018 will consist of 15 sites, six confirmed and nine on the reserve list. The total land space is expected to provide 8,045 new private homes, of which around 2,775 can come from the confirmed list.

This is almost no change from the second half of this year, when we had 16 sites yielding about 8,125 new private homes.

2. The government isn’t giving in to developer demand, to avoid a potential supply overhang

Foreign developers, mainly from China, have been muscling their way into Singapore’s property market. Their entry has driven land prices up by 29 per cent as compared to five years ago, and their aggressive bidding has seen local developers forced to make equally huge bids.

As such, there was some expectation that the government would increase the number of land sales. However, the government’s got an eye on potential supply overhang.

It’s expected that around 20,000 new units will come out of all the en-bloc sales and GLS sites this year. The Ministry of National Development (MND) also pointed out that more than 30,000 private homes are still vacant. The Ministry believes the total supply of homes (inclusive of the new ones from 1H 2018 land sales) should suffice for one to two years.

That suggests we probably won’t see a lot more land sales in the second half of 2018, either.

3. There are three Executive Condominium sites in the 1H2018 GLS programme

Buyers will probably be on the lookout for the ever-desirable Executive Condominiums (ECs). These are HDB properties that can be bought with CPF grants, but which are fully privatised after 10 years. ECs are also full suite condos, built by private sector developers.

There are two EC sites on the reserve list, at Tampines Ave 10 and Anchorvale Crescent. One other EC site is on the confirmed list, at Canberra Link.

The Canberra Link site is expected to yield about 450 EC units, while the Tampines Ave 10 plot is expected to yield 715 EC units. The Anchorvale Crescent plot could yield around 540 units.

That’s not a lot to go around, considering the high demand for ECs; get ready for long queues in showrooms if you want one.

4. The Cuscaden Road plot is likely to fetch the highest value

The Cuscaden Road site (61,598 square feet) is likely to yield 170 units, and has a fantastic location – it’s just minutes away from Orchard Road, and the bids are expected to be around $1,700 psf.

This is an ideal site for a luxury unit. The location may be attractive to investors, who will want to buy to rent out (especially if the financial and oil and gas sectors pick up this year, and the affluent expatriates come back).

It will be interesting to see if the cooling measures still deter them, this coming year.

5. The Canberra site will be the one to look for, among home buyers

There are very few ECs near the Canberra site, and Canberra MRT station will be ready in 2019. This is expected to cut travel time to the downtown core, or to Jurong East, by 10 minutes.

Keep an eye out for any developments here, if you work in town and want quick access.

If you found this article interesting, you may want to read more about 5 property trends we’ll probably see in 2018 and how to keep a cool head in a sizzling property market.