By Thomas Cho | Posted: 29 January 2013 2321 hrs

SINGAPORE

The government is planning to build 700,000 new homes by 2030 to meet the projected increase in population to up to 6.9 million in about 20 years.

Market observers said that the key challenge is to ensure that the supply of housing and supporting infrastructure rolled out is in line with population growth.

The government plans to roll out some 200,000 new homes by 2016 and it is setting aside land to build another 500,000 units till 2030.

Plans are also in the pipeline to improve transport infrastructure.

Eight hundred buses will be added over the next five years. And by 2030, Singapore’s rail network will double to 360 kilometres from 178 kilometres currently.

Experts said the government will have to carefully manage the development of facilities to ensure that they’re in line with population growth.

Chua Yang Liang, head of research (Southeast Asia) at Jones Lang LaSalle, said: “The crux of the issue is the speed in which the population increases versus the infrastructure and the completion of the housing stock. These two elements of infrastructure development and housing development take time. It takes an average two years for housing, 1.5 to two years to meet the demand. That has to be timed accurately.”

To curb soaring property prices, the authorities have recently stepped in to cool the market with a slew of measures like higher purchasing taxes.

With the projected population increase and new home supply, analysts believe demand for housing will remain sustainable.

Getty Goh, director at Ascendant Assets, said: “We will not expect a significant drop in property prices. However, will it go up? I think there is a big question mark. The government is taking a lot of concerted effort to make sure that prices do not go through the roof.”

City planners expect more home-buyers to be attracted by new satellite townships with commercial hubs.

This will allow residents to work and play near their homes.

William Lau, president of Singapore Institute of Planners, said: “More new towns will happen. For existing towns like Bishan and Ang Mo Kio, it is best to stay at status quo and not to affect the (population) density too much, and switch new population growth into new area.”

The White Paper has listed Woodlands, Serangoon and Punggol as possible growth areas for businesses.

Jurong Lake District, Paya Lebar Central and One-North will also be expected to mature by then.

The National Development Ministry is expected to release more details on land use plans this week.

– CNA/fa