Wednesday, September 05, 2012

Govt curbs shoebox mania

In a bid to provide ample supply of large and small homes that cater to the diverse needs of home buyers in Singapore, the Urban Redevelopment Authority (URA) has announced new guidelines to cap the number of shoebox units, particularly at all new non-landed private residential developments in suburban areas.

With immediate effect, the regulations aim to “discourage new developments consisting predominantly of shoebox units outside the Central Area”, while providing developers with the flexibility to offer different home sizes, said the URA.

According to National Development Minister Khaw Boon Wan, the guidelines follow the successful implementation of similar rules in the Central Area last November. Back then, shoebox units were growing fast, especially in the Telok Kurau area, “resulting in disamenities such as severe traffic congestion, shortage of car parks and double-parking”.

As such, the URA consulted with stakeholders and decided to limit the number of small units that could be developed, “but in a judicious way, without over-regulating or stifling the creativity of developers”, highlighted Mr Khaw.

Despite this, the supply of shoebox units is expected to grow from 2,400 as of end-2011 to 11,000 by 2015; as such homes are increasingly being integrated into new projects.

Meanwhile, the URA received feedback from consumers indicating that shoebox homes appeal to certain buyers such as singles, retirees and couples without children, but larger families, especially those with children, prefer larger units.

Taking this into consideration, the URA has adopted a “calibrated approach” to moderate the development of shoebox units outside the Central Area, to provide sufficient supply of large and small units.

Mr Khaw assured the public that the new guidelines “are measured and moderate” and would still support demand for shoebox units, but at a more moderate pace.

Dr. Chua Yang Liang, Head of Research for South East Asia at Jones Lang LaSalle (JLL), said that the policy “is helpful in maintaining a vibrant and inclusive society where the housing form is not dominated by the larger societal norm but encouraging diversity to support the continual development of our real estate market”.

At the same time, Png Poh Soon, Head of Research at Knight Frank Singapore, noted that the latest regulation is a “fairly efficient approach to fulfil two objectives - to increase the proportion of larger-sized units, while providing the flexibility to provide smaller units in a development”.

He added that this reflects the government’s goal “to create liveable spaces conducive for family building especially in suburban areas”.

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