Gov't Has Important Role In Property Market: Mah

Source : The Business Times, November 26, 2008

The Government has an important role in ensuring the long-term stability and smooth functioning of the property market, said Minister for National Development Mah Bow Tan at the Real Estate Developers' Association of Singapore's (Redas) anniversary dinner tonight.

'Let me first highlight why the real estate sector is important to us,' Mr Mah said.

Mr Mah's comments comes in the wake of public queries over the government's role in the property market, with some wondering if the land prices should be left to market forces.

Mr Mah said there are mainly 3 key reasons.

'First, it is a major economic sector in Singapore. The real estate services and construction sectors together accounted for about 9.6 per cent of overall GDP and 13 per cent of total employment in Singapore in 2007. Second, the health of the property market affects other major sectors of the economy. Third, as a country with the highest rate of home-ownership of more than 90 per cent, the property sector is where most of us have invested our hard-earned lifelong savings.'

The Government will do whatever is within its means to help all the various economic sectors in Singapore cope with the current crisis and mitigate the impact on businesses, Mr Mah said.

For the property market specifically, the Government will ensure that the supply of land released for development is well calibrated and sufficient to meet demand over the medium to long term. It will also give developers the flexibility to activate Government Land Sales supply according to market demand by using a pre-dominantly market-led approach through the use of the Reserve List.

The authorities will also provide detailed real estate information to enhance market transparency and allow informed decision-making by market players, and will put in place policies that ensure that systemic risks to both the demand and supply sides are minimised, thus safeguarding the overall health of the property market, Mr Mah added.

Finally, the Government will also guard against irrational market behaviour such as excessive speculation that is not in sync with economic fundamentals, Mr Mah said.