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Why it’s difficult for HDB to predict demand

THE Housing Board cannot accurately predict demand for HDB flats years down the road.

However, it will be flexible and boost the supply of flats when needed, Minister of State for National Development Grace Fu said yesterday.

She gave this assurance in response to a question from Madam Cynthia Phua (Aljunied GRC), who wanted to know how long newly married couples can expect to wait for a new flat.

With rising property prices and surging demand for HDB flats, some young couples have reportedly had to postpone their customary wedding ceremonies because they could not get a flat in time.

Madam Phua also noted that the HDB seems to face a problem of ‘excesses’: Three years ago, it had 10,000 excess flats. Now, it has 27,000 applicants for more than 4,000 flats.

She asked if the ministry would consider providing data on the potential supply of flats over the next three years, to help young couples plan.

In response, Ms Fu said it would be difficult to ‘predict with precision’ demand for HDB flats over a three-year time frame.

‘There are certain market forces that affect supply, demand of public housing vis-a-vis private housing, for example, that are not possible to predict with accuracy,’ she said.

Ms Fu pointed out that while demand far outstrips supply in popular projects like Telok Blangah Towers, that is not the case in others.

For example, first-time flat owners have a one in two chance of getting a flat in upcoming projects in Sengkang and Punggol.

She advised buyers to carefully consider their budget and how long they are prepared to wait before making a decision on which project to apply for.

She also assured MPs that the supply of flats will be adjusted when necessary.

Last year, for instance, the HDB offered 13,000 flats for sale, more than double the number in 2006.

This year, it expects to offer about 6,000 flats in the first half of the year.

‘Our building plan has flexibility and where we see there’s a high subscription rate, we will increase the supply of HDB flats,’ said Ms Fu.

 

Source: The Straits Times 23 Jan 08

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