Malaysia’s housing market to pick up first half of year 2012

The Malaysian housing market is expected to pick up in the first half of 2012 with buyers and developers showing more confidence in the Malaysian market.

A Real Estate and Housing Developers’ Association Malaysia (Rehda) survey found that 79 per cent of the 148 developers who responded were optimistic of the first six months of this year compared with 81 per cent in the second half of 2011. Some 63 per cent said they will launch new projects in the first six months of this year, against 58 per cent in the preceding six months.

Seventy-four per cent of the respondents said they will increase their selling prices by five per cent to 20 per cent this year. The survey also showed that 38 per cent of respondents are facing challenges with building materials, particularly the pricing of bricks, cement and steel bars, and it is having an impact on their cash flow.

Datuk Seri Michael K.C. Yam, president of the Real Estate and Housing Developers’ Association Malaysia (Rehda), outlines what are the major challenges and reasons for increasing prices in the housing market.

“This is due to the high costs of building materials and labour, which continues to be major challenges for the industry. Land cost is also increasing and we have no choice but to pass it on to customers as our margins are eroding,” Yam said.

Link House At Bukit Sentosa Rawang For Sale

Subject Property:-

ID NUMBER : MYS - RLH(S) 2


SALE PRICE

• Ringgit Malaysian One Hundred Thousands ( RM100,000. ) only.    SOLD !!

LOCATION

• Located at Jalan Angerrik 3C/1 Section BS7 Bukit Sentosa township,within vicinity of upcoming new Tesco superstore completing in June 2011;
• Next to Bukit Beruntung development ;( Google Site Map link http: Unavailable )

PROPERTY DESCRIPTIONS

• Property Type : Terrace Link House;
• Occupancy : Vacant;
• Land Area : 20' X 70'; 
• Tenure : Freehold;
• Front  View Direction : North;
• Bedrooms :  4;
• Bathrooms : 3;

• Position : Intermediate;
• Number of Storey : Two;
• Condition : Repair Work Needed;
• Free from encumbrances 
• Amenities :  Eateries, Groceries Shops, etc;  
• Furnishing : Nil

Please quote ID number above when contacting us
Contact : Alvyn Goh at 6 016 3111313

                 Senior Real Estate Agent

Email: inter.realestate.network@gmail.com

Disclaimer of Liability

Note that any properties listed as available at this material time for sale or rent herein may at any time be withdrawn, sold or rented out without any prior notice for any reason(s) whatsoever and our real estate agency or our agents shall not be held any liability whatsoever to prospective Purchaser or Tenant for the reasons specified above of such withdrawal.

The photographs shown and informations provided herein are solely for general identification and genuinely in good faith provided to be true at this material time. However, our real estate agency and agents make no representation or warranty as to their absolute accuracy or the actual condition of the property(ies).

Link House At Bukit Sentosa Rawang For Sale

Subject Property:-

ID NUMBER : MYS - RLH(S) 1


SALE PRICE

• Ringgit Malaysian One Hundred Forty Thousands ( RM140,000. ) only.               SOLD !!              

LOCATION

• Located at Jalan Angerrik 3C/1 Section BS7 Bukit Sentosa township,within vicinity of upcoming new Tesco superstore completing in June 2011;
• Next to Bukit Beruntung development ;( Google Site Map link http: Unavailable )

PROPERTY DESCRIPTIONS

• Property Type : Terrace Link House;
• Occupancy : Vacant;
• Land Area : 20' X 70' with extra 826 sf back & side land; 
• Tenure : Freehold;
• Front  View Direction : North;
• Bedrooms :  4;
• Bathrooms : 3;

• Position : Corner;
• Number of Storey : Two;
• Condition : Minor Repair Work Needed;
• Free from encumbrances; 
• Amenities :  Eateries, Groceries Shops, etc;  
• Furnishing : Nil

Please quote ID number above when contacting us
Contact : Alvyn Goh at 6 016 3111313

                 Senior Real Estate Agent

Email: inter.realestate.network@gmail.com

Disclaimer of Liability

Note that any properties listed as available at this material time for sale or rent herein may at any time be withdrawn, sold or rented out without any prior notice for any reason(s) whatsoever and our real estate agency or our agents shall not be held any liability whatsoever to prospective Purchaser or Tenant for the reasons specified above of such withdrawal.

The photographs shown and informations provided herein are solely for general identification and genuinely in good faith provided to be true at this material time. However, our real estate agency and agents make no representation or warranty as to their absolute accuracy or the actual condition of the property(ies).

Will the slowdown in property prices continue?

Yes.

In all likelihood, there will just be slower growth across the board for the mere fact that the last three years have seen exceptional growth since 2008, when the global crisis hit. The following year saw a recovery and 2010 was a year of exceptional growth. Property professionals had never seen such price increases in their 30 years in the profession, where prices went up by double digits in a short period of time.

This year witnessed continued exuberance among developers, agents and property buyers. The final two quarters usher us into 2012, which will be the year of the “great slowdown”.

It will be perceived as such because of the remarkable growth experienced in 2010, but in reality, it is not really a slowdown. It is not possible for prices to go up, up and away until kingdom come.

There has to be a reality check. So we will see slower growth in the coming year. In some locations, prices may hold their ground, but unless something major happens, whether at home or abroad, prices are unlikely to recede in the Klang Valley and other major cities.

Hence, it is not that there will be no growth; price increases next year will be slower, and more subdued and stable. In some locations, prices may plateau.

If there is still growth, however small, why call 2012 the year of the great slowdown?

On the global front, we have the eurozone crisis, which is still unravelling. If the eurozone breaks up, it will affect sentiments. The stock market will be the first to be impacted by the dim outlook and this will spill over into the property sector.

Of greater concern are individuals who have over-invested. They may find it challenging to meet their commitments. These include those who have multiple property purchases, and young people who over-committed themselves with properties costing RM500,000 and more

Property Sector Moving To Readjust

The steep increases seen in the last two years expected to sputter to a halt on weak global sentiment

The overall weak global sentiment is expected to cast a pall over the property sector, which is expected to undergo some downward correction this year, agents, property consultants and developers say, with the steep increases seen in the last two years sputtering to a halt. Virtually all segments of the property market will be affected.

International Real Estate Federation (Fiabci) Malaysia president Yeow Thit Sang says the slowdown, though gradual, will be seen in the pricing and take-up rate of all housing segments, particularly more so in the high-end category.

“Whether it is Penang or the Klang Valley, we don't have that many multinational companies coming in to occupy some of our high-end properties. Rentals with yields of between 6% and 8% are no longer achievable,” he says.

This slower rate of growth is expected to be more apparent after the new ruling by Bank Negara kicks in. Effective Jan 1, new lending guidelines require banks to use net income to calculate the debt service ratio for loan approvals.

The new guidelines cover all consumer loan products including housing loans, personal loans, car loans, credit-card receivables and loans for the purchase of securities.

While this latest round has the objective of reducing overall household debt, it will affect the property sector, a branch manager of a local bank says.

Previous lending guidelines capped monthly mortgage repayment at 1/3 of net pay instead of gross pay. This new ruling, and the requirement to have a 30% downpayment on the third and subsequent property, introduced in 2010, will result in the banking sector being more stringent when it comes to mortgage loan approvals. The re-imposition of the real estate property tax, at 5% flat within five years of purchase, was another measure to curb speculation.

These measures, together with the global concerns over the United States and the eurozone, will affect sentiment. However, there will be opportunities in the affordable housing segment, which is part of the Government's Economic Transformation Programme.

Says Ireka Corp Bhd executive director Lai Voon Hon: “We see strong growth potential in these under-served' sectors such as mid-market residential and commercial as well as green' developments located close to infrastructure nodes. Market movement in recent months had observed major developers acquiring parcels of land outside the Klang Valley such as in Kajang, Semenyih and Nilai which are destined to be the next “hot spots”.

“With 65% of the Malaysian population falling under 35 years old, we trust that the demand will pick up as consumer confidence recovers. Close to 10 million people are expected to work, live, learn and play in the Greater KL metropolis by 2020.

“Burgeoning young and middle-class population also means the demand for mid-market properties will remain steadfast,” Lai said, adding that the mid-market will receive strong support in terms of demand, and this will be Ireka's primary focus in 2012.

Other developers to move into affordable housing include the Sime Darby group and Mah Sing group. Sime Darby recently launched affordable housing in Bandar Ainsdale in Seremban. Mah Sing Group Bhd, too, is moving away from high-end housing to go into the affordable housing segment.

Mah Sing group managing director and group CEO Tan Sri Leong Hoy Kum says: “The high-end sector, both landed and high-rise, will be more challenging with the RM4mil and above units taking longer to sell.”

Ireka's Lai says the company will be developing a 28-acre freehold land in Bandar Nilai Utama, Negri Sembilan into a trendy mid-market neighbourhood, consisting of landed houses and apartments. Another five acres of prime land in Kajang will be developed into a mixed development. consisting of two mid-market apartment blocks and a retail precinct.

Ireka will also embark on a modern industrial park development on its 21-acre freehold land in the established Sungai Chua industrial area near Kajang.

Aside from these three mid-market developments, in the pipeline is the launch of its boutique hotel and serviced residences project in Jalan Kia Peng, within the Kuala Lumpur City Centre (KLCC). This 30:70 joint development project between Ireka and Aseana Properties Ltd is slated for launch in the second half of next year.

On the overall market, Lai says launches and sales take-up rate will be generally slower. However, Malaysia's property sector (will be) resilient, he says.

Property consultant DTZ Debenham Tie Leung's executive director Brian Koh says “properties will have to be sensibly priced” with smaller units (if they are condominiums), selling better than larger ones. DTZ will be launching Naza TTDI Sdn Bhd's Platinum Park around the KLCC area next year.

Over in the office segment, the current glut is expected to persist into next year which will put pressure on rentals.

The overall view of property professionals is that the office market in Kuala Lumpur will remain soft next year unless the global economy recovers sufficiently to spur business expansion to take up the current supply in the city. With the eurozone the way it is, that seems unlikely.

Y. Y. Lau of YY Property Solutions expects Grade A office buildings in KL (existing and new) to face intense competition to secure tenants next year.

“Demand for prime Grade A office buildings held up well last year. But we are expecting an estimated five million sq ft of office space to come onstream in the Kuala Lumpur Commercial Business District and city fringes by end-2012, with KLCC and the Golden Triangle area providing over 90% of the new supply in the first half of next year. “In the second half, the bulk of the supply will be coming from the fringes of Kuala Lumpur.

“We opine that KL Sentral, Bangsar South and Mid Valley City will play a catch-up game in attracting eminent companies seeking MSC status and green building features, as well as conveniences in terms of availability of public transportation, ample eateries and amenities, and upgrading of corporate image. Good building quality and property management services provided are expected to attract companies to set up its businesses here,” Lau says.