Jan 10, 2011 - The Straits Times
The landed home crunch will likely worsen in the coming years, due to limited available stock.The number of landed homes has risen by only six percent in the last 10 years, while the number of apartments has gone up by 47 percent.
As of the third quarter of last year, 69,701 of the 256,513 private homes were landed, based on data compiled by Credo Real Estate.
This shortage likely means that property developers will look towards increasing their land use, possibly developing more strata-titled landed homes as an alternative.
Also called cluster homes, these homes combine the appeal of conventional landed homes with shared condo-style facilities. However, they come with strata titles, so owners cannot renovate or rebuild their homes like they can in conventional landed homes.
As of Q3 2010, landed homes accounted for 27 percent of the private residential market, compared to 34 percent in 2000. While around 60,000 private apartments have been constructed in Singapore since 2000, only 4,000 landed homes have been added, said Credo.
The shortage of land is frustrating for property developers, as demand for landed homes has risen because of the growing economy.
Of the estimated 250 private residential site transactions over the previous five years, only 15 plots were for landedproperty development, it said.
The supply-demand squeeze is behind the growing popularity of strata-titled homes.
Karamjit Singh, managing director of Credo, said these homes enable developers to build more units that use common facilities on the site without sacrificing land for roads.
Mr. Ong Kah Seng, senior manager of Asia-Pacific research at Cushman & Wakefield, said the shortage of landedhomes may instead push some buyers into strata-titled property - a trade-off that gives up a land title and exclusivity for a newer home with shared facilities.
“Shared facilities can be cost saving for the owner, who does not have to develop the facility,” he added.
