THE latest government land sales (GLS) programme continues to cut the land supply for residential home units taking into account the impact on the property market from the Covid-19 situation.

The confirmed list released on Wednesday comprises three private residential sites - including one executive condominium (EC) site - which can yield about 1,370 private residential units (including 615 EC units) and 1,500 square metres (sq m) gross floor area (GFA) of commercial space.

All three sites on the confirmed list are new sites, with an EC site at Tengah Garden Walk. The two residential sites at Northumberland Road and Ang Mo Kio Avenue 1 - in mature housing estates - will yield 385 and 370 private home units respectively.

According to Desmond Sim, CBRE head of research, South-east Asia, the total of 1,370 residential units proposed for the confirmed list of GLS in H2 2020 is the lowest since H1 2016 when 1,560 units were offered.

He said that with a build-up of unsold units from launched projects (4,506 units in Q1 2020 from 4,389 units in the previous quarter), the number of residential units introduced on the confirmed list has been on the decline since H1 2019 in the aftermath of the en bloc frenzy.

The land supply from the H2 2020 GLS programme has been calibrated to take into account the global Covid-19 situation, said the Ministry of National Development (MND).

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"Given the economic contraction and uncertain business outlook, the government has decided to reduce the supply of private residential units on the confirmed list and will not introduce any new sites for predominantly commercial or hotel use in the H2 2020 GLS programme," said MND.

"However, we have to calibrate the reduction carefully to avoid potential supply shortfalls over the medium to longer term. Hence, we have maintained a good selection of sites with additional supply in the reserve list that developers can initiate for development if they assess that there is demand."

The reserve list comprises five private residential sites (including one EC site), three white sites and one hotel site. These sites can yield about 5,300 private residential units (including 590 EC units), 100,000 sq m GFA of commercial space and 1,070 hotel rooms.

MND noted the progressive decline in the unsold inventory of private housing units over the past year. The number of unsold private housing units with planning approval has declined by a cumulative 20 per cent between Q1 2019 and Q1 2020, it said.

The government has provided a moderate supply via the confirmed list in the H2 2020 GLS programme, it said.

"Together with the supply of units already in the pipeline, this will cater to the housing needs of the population when completed in about four to five years' time."

The confirmed list sites will be launched in the last quarter of 2020, each with a longer tender period of about six months to give developers more time to make their assessment in view of the ongoing Covid-19 situation, it said.