National Development Minister Khaw Boon Wan urged potential buyers to weigh the benefits and risks carefully of the so-called shoe-box units, amid suggestions that the government steps in to impose a minimum size.
Writing in his blog on Friday, Mr Khaw said the government is watching the development of the shoe-box units.
He said some analysts wonder if buyers know what they are in for but stressed that potential buyers should go in with eyes open as a shoe-box unit is not the same as a 3-room flat.
Shoe-box units, a common term in the industry globally, refers to an apartment which is very small, typically below 500 square feet, about the size of a standard hotel room in Singapore.
A 3-room standard HDB is about 700 square feet.
Mr Khaw said the government is is requiring developers to give buyers an accurate representation of the units they are buying, both within the show flats and in the sales materials.
He said industry analysts and developers have shared their comments with on shoe-box units.
First, many of these units will be completed soon.
By 2014, the total number of completed units will increase from 1,100 to 3,800, based on known plans.
Second, some developers who bid high prices for sale sites are planning to build shoe-box units, adding to the build up.
Third, the newer shoe-box developments are in the suburbs, and their appeal to tenants remains untested.
His instinct is not to second guess the market, as these units add to the diversity of housing options in Singapore
Mr Khaw also noted that there seems to be demand for such units.
The annual take-up has increased from 300 units in 2008 to 1,900 in 2010, or from six per cent to 12 per cent of developers' sales over the same period.
He said 80 per cent of the buyers are Singaporeans, presumably for investment, with a view to rent to expatriates or singles.
He added that analysts can also help refine their analysis by including separate analysis for each category of housing products.
He said comparing price per square foot for different products is like comparing apples with oranges.
Shoe-boxes apartments are common in Hong Kong and Tokyo.
However, Mr Khaw believes that Singaporeans are house-proud and want their apartments to be cosy, comfortable and spacious.
Writing in his blog on Friday, Mr Khaw said the government is watching the development of the shoe-box units.
He said some analysts wonder if buyers know what they are in for but stressed that potential buyers should go in with eyes open as a shoe-box unit is not the same as a 3-room flat.
Shoe-box units, a common term in the industry globally, refers to an apartment which is very small, typically below 500 square feet, about the size of a standard hotel room in Singapore.
A 3-room standard HDB is about 700 square feet.
Mr Khaw said the government is is requiring developers to give buyers an accurate representation of the units they are buying, both within the show flats and in the sales materials.
He said industry analysts and developers have shared their comments with on shoe-box units.
First, many of these units will be completed soon.
By 2014, the total number of completed units will increase from 1,100 to 3,800, based on known plans.
Second, some developers who bid high prices for sale sites are planning to build shoe-box units, adding to the build up.
Third, the newer shoe-box developments are in the suburbs, and their appeal to tenants remains untested.
His instinct is not to second guess the market, as these units add to the diversity of housing options in Singapore
Mr Khaw also noted that there seems to be demand for such units.
The annual take-up has increased from 300 units in 2008 to 1,900 in 2010, or from six per cent to 12 per cent of developers' sales over the same period.
He said 80 per cent of the buyers are Singaporeans, presumably for investment, with a view to rent to expatriates or singles.
He added that analysts can also help refine their analysis by including separate analysis for each category of housing products.
He said comparing price per square foot for different products is like comparing apples with oranges.
Shoe-boxes apartments are common in Hong Kong and Tokyo.
However, Mr Khaw believes that Singaporeans are house-proud and want their apartments to be cosy, comfortable and spacious.
