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The Government has taken the unusual step of reassuring private home buyers that there are plenty of brand-new unsold units in the pipeline - about 22,700 of them.

It offered this new figure in what is being seen as a move to calm the booming property market, even as the latest estimates show that private home prices shot up 7.9 per cent over the last three months.

In an unusual addendum to the price estimates released yesterday, the Urban Redevelopment Authority (URA) reassured home buyers that the supply of homes over the next few years will be plentiful.

It reiterated that around 42,200 new homes will be completed between now and 2010. Of these, slightly more than half have yet to be sold, it said.

These include units that have already been launched but not yet taken up, as well as those that have not yet been launched for sale.

While the URA did not provide details of where these homes will be located, property consultants estimated that most of them will be in the central areas.

For the rest of the island, the Government has already taken steps to alleviate the situation. Last month, it announced it will release a slew of land plots in the second half of this year, enough for developers to build about 8,000 homes.

This comes as some property watchers issue alerts of a potential supply crunch of homes in the market, following an unprecedented wave of collective sales that will lead to thousands of homes being torn down.

But the Government was quick to assure buyers that ‘it will continue to monitor the market very closely’.

‘The Government will ensure that there will be sufficient supply of residential space to meet demand,’ the URA said. ‘If necessary, the Government will make available even more sites for private residential development… next year.’

It added that ‘prospective home buyers should take into consideration the sufficient pipeline supply of private housing, as well as the potential supply… when deciding to make a property purchase’.

Dr Chua Yang Liang, head of Singapore research at Jones Lang LaSalle, saw the Government’s statement as ‘quite a strong indication to tell the market there is adequate supply, and not to go on a panicked buying spree’.

The URA also appeared to be addressing fears of a property bubble in its statement. It was quick to say that the jump in home prices was due to strong fundamentals. ‘The increase in private housing prices in recent quarters is in line with greater economic growth and rising confidence,’ it said.

‘Private housing prices are now increasing at a faster pace because of good economic prospects going forward and the increasing attractiveness of Singapore as a global city.’

Source : Straits Times - 3 Jul 2007