Penang Property Talk

The Transport Ministry has approved Penang’s Bayan Lepas light rail transit (LRT) project, says Anthony Loke.

In a statement Tuesday (July 17) the Transport Minister said approval was given after detailed study of the Penang Economic Planning Unit’s (BPEN) application to develop the Bayan Lepas LRT project.

However, the state would have to exhibit documents of the project for a three-month period and the final go-ahead will only be decided after public responses are evaluated, said Loke.

“The application by Penang BPEN to develop the Bayan Lepas LRT scheme has been approved on July 16 subject to conditions stipulated under Section 83 and 84 of the Land Transport Act 2010.

“After approval is given, the applicant is required to deposit all required documents to the Land Public Transport Agency (Apad) for public inspection and for them to raise objections within a three-month period starting from the final date of notice published in local news advertisements.

“The completed documents of the project are to be exhibited in public places including government offices.

“The applicant must also upload a copy of the documents on a website for online viewing.

“After evaluating the public responses during the public viewing, another application for confirmed approval has to be submitted,” said Loke in the statement.

The RM8.4bil Bayan Lepas light rail transit (LRT) together with a monorail, cable cars and water taxis, is part of the state government’s RM46bil Penang Transport Master Plan (PTMP).

It will begin from Komtar in the northeast corner of the island and pass through Jelutong, Gelugor, Bayan Lepas and Penang International Airport before ending at the proposed Penang South Reclamation (PSR) development comprising three man-made islands totalling 1,800ha near Teluk Kumbar.

It is expected to provide a fast route to the airport and will traverse densely populated residential, commercial and industrial areas.

There are 27 LRT stations along the alignment, with the maintenance depot located on the first island that is to be reclaimed on the island’s south coast.

Media Statement from Transport Ministry

Source: TheStar.com.my

By Dr. Paul Selva Raj

The Ministry of Housing and Local Government has announced that backlisted National Higher Education Fund Corporation (PTPTN) borrowers who are listed on the Central Credit Reference Information System (CCRIS) will not be blacklisted if they apply to buy a home. Is this measure good for consumers, especially young workers, the banks and the property developers?

Firstly, being listed on CCRIS should not in itself become the deciding factor in rejecting loans to young workers, or for that matter, any consumer. It certainly should be a contributing factor. There are two possible scenarios when a consumer is blacklisted in CCRIS.

Firstly, one has poor financial management skills resulting in spending beyond one’s means, high credit card debt or multiple other loans beyond one’s ability to pay. In a study by the Asian Institute of Finance, 75 percent of consumers in the age range of 20 to 33 had at least one long-term debt, possibly PTPTN loan; however, another 37 percent had more than one long-term debt. Furthermore, a Bank Negara study shows that 76 percent of consumers would find it difficult to raise RM 1,000 to face an emergency while 47 percent had high credit card debts. For this category, an additional housing loan would only make matters worse.

On the other hand, there may be those who had to face some sort of personal or family catastrophe, and in the short-term was unable to make the payments on a certain loan and was thus blacklisted. This group certainly deserves to be considered for a housing loan.

Thus, past credit behaviour should certainly weigh in on the loan application process, but the CCRIS blacklisting should not automatically be the reason to reject a loan.

While the Federation of Malaysian Consumers Associations (Fomca) recognises that owning a home is a basic consumer right, the key factor in acquiring a loan by the consumers and approving a loan by the bank must be the ability of the consumer to repay the loan.

Apart from the consumer’s financial habits, two key factors that determine repayment ability is income and the price of houses. In relation to one’s income, the house must be affordable. Are Malaysian houses affordable?

According to Khazanah Research Institute and Bank Negara, the sign of a well-functioning, affordable home market is when the median price across the whole housing market is three times the gross annual household income.

Overall in Malaysia, house prices are 4.4 times the median income. Further, zeroing in on the states and cities, house prices in Kuala Lumpur are 5.4 times the median income; in Penang, it is 5.2 times; in Johor it is 4.2 times; and in Selangor it is 4.0 times.

Furthermore, while Bank Negara says an affordable home is RM242,000, in actual fact the average price of houses in KL is RM490,000; in Selangor it is RM300,000; in Johor it is RM260,000 while in Penang it is RM295,000.

To put it simply, houses in Malaysia are simply not affordable to consumers.

The efforts, through policy and programmes, then should be to reduce the price of houses to the affordable range.

Thus, the first priority in assisting home ownership should be to build affordable homes as well as to get the private sector to build affordable homes.

The private sector is more keen to build expensive homes with very high rates of return, of course, but when these expensive houses cannot be sold, it puts pressure on banks to approve loans to consumers, especially young workers even though they may not be able to afford the monthly payments.

While young workers have a right to own a home, purchasing a home beyond their means can only result in severe financial hardship in the near or long term.

CCCRIS and other credit scores should help banks to determine if loans should be given; however, a more comprehensive and detailed study should be made to enable first-time home owners to buy their homes.

Consumers, on the other hand, need to take a comprehensive look at themselves and assess their ability to make regular house loan payments in the context of other current and long-term financial commitments.

What is seriously lacking currently is a strategic approach to financial literacy programmes for young workers and young families.

It is critical that young workers and young families develop the knowledge, skills and motivation to assess their current financial habits and management practises and develop more optimal practices towards enhanced spending, saving and investments, and debt management to develop more responsible financial behaviour.

Further, due to low uptake of insurance, especially medical insurance, as well as preparation for retirement, financial education is key to ensuring that young consumers are prepared to face financial challenges at every stage of their lives.

When a young consumer is blacklisted in CCRIS, there is a high possibility that there is a serious problem in the way he/she is managing his/her debts. The way forward should be to educate and empower young people to manage their finances, not make it easier for them to get a huge loan, which could only lead to further financial problems.

Dr. Paul Selva Raj – Chief executive officer of Federation of Malaysian Consumers Associations (Fomca).

Source: TheStar.com.my

Work on the next phase of the Penang South Reclamation (PSR) project has started following approval from the Department of Environment (DoE) early this month.

Chief Minister Chow Kon Yeow (pic), however, did not elaborate on the works being carried out by project delivery partner SRS Consortium.

“The agreement was that SRS cannot move into the second stage of the project until the approval was obtained, which was a prerequisite for them to claim from the government.

“Since the approval has been given, some of the works will subsequently be reimbursed,” he told newsmen after flagging off the SXI Padang Kota Run here yesterday.

MP to explain further about the project.

“I met Anwar in Parliament, and we exchanged views on the PSR. We will arrange a briefing session for him if needed,” he said.

Chow said those who criticised the PSR were actually not against the project, but were rather concerned about certain aspects of the reclamation.

“Right now, I cannot say otherwise as we are already moving into the second phase, and I hope it will proceed in the bigger interest of the state and the people of Penang.”

Chow said the state would announce the 72 conditions im­posed by the DoE tomorrow.

The PSR project near Teluk Kum­bar is a massive plan to reclaim three islands, measuring 1,800ha or the size of 3,600 football fields.

About 75% of the three islands will be for sale via open tender.

The project is expected to generate RM70bil, of which RM46bil will be used to fund the Penang Transport Master Plan.

Source: TheStar.com.my

Eco World Development Group Bhd (EcoWorld) has started to hand over the completed units at its Eco Terraces condominium project on Penang Island.

Sitting on a 12.79-acre freehold site, Eco Terraces is a condominium that houses 333 units within a 33-storey building at Jalan Paya Terubong, Paya Terubong. Residents get to enjoy a clubhouse that offers a wide array of wellness services and programmes.

With a gross development value of RM405.61 million, the project is Penang’s first multi-generational wellness-themed residences and the first project by EcoWorld on Penang Island, said EcoWorld divisional general manager Chan Soo How.

“This is a project that caters to people of all ages, from toddlers to elders by providing a full range of wellness services.

“We understand that a lot of buyers have multi-generational families that include young kids and elderly parents, so we designed this project to cater to all — young, middle -aged to elderly,” Chan said during a media tour of the project recently.

Launched in 2015, Eco Terraces has recorded a take-up rate of about 70%. The units have built-ups of between 1,095 sq ft and 2,008 sq ft priced at an average RM880 psf.

Chan noted that the project’s wellness concept is one of its main pull factors. Buyers were mostly locals staying in the vicinity.

“There are also buyers from other states, such as Kuala Lumpur and Kedah. The wellness concept attracted many to come and buy and we have been receiving a lot of interest from both local and overseas buyers,” he said.

Eco Terraces’ clubhouse boasts comprehensive services including wellness, childcare and concierge. The clubhouse has a care hub that offers 24/7 nurse-on-call service and monthly doctor consultation for the residents.

There is also a multi-purpose sports hall, karaoke rooms, mini theatre and golf simulation room.

The nurse-on-call service is a collaboration between EcoWorld and home nursing service provider Lifeline, to offer services such as first aid; blood pressure, blood sugar and cholesterol monitoring; and medical assistance during emergencies.

A certified nurse will be stationed at the clubhouse during the day and then switch to a designated centre located on the eighth floor of the condominium at night. This is to ensure that in the event of an emergency, the nurse will be able to attend to the situation as soon as possible, rather than having to rush over from the clubhouse, which is a separate building, explained Chan.

“The care hub aims to help those who find it difficult to take care of their elderly parents for example, due to financial or time constraints. It can act as the first line of support for the residents. Depending on future demand, more nurses can be added to be stationed at the care hub,” he said.

Furthermore, the residents can engage Lifeline for personalised care services, including home nursing service, post-hospitalisation care and hospice service at a chargeable rate.

Regular wellness programmes such as yoga, badminton and dance classes will be hosted at the clubhouse, he added.

To ensure the sustainability of the services, EcoWorld will continue to help the homeowners in future to handle the maintenance and management work.

“Although Eco Terraces will eventually be handed over to the MC (Management Corporation) due to the fact that it is a stratified development, we have the confidence that the owners will continue to engage us to provide management services to them, just like every other EcoWorld project,” he said.

Source: EdgeProp.my

Ideal United Bintang International Berhad (IUBIB) had on July 9, 2019 submitted to Bursa Malaysia, announcing the acquisition by IUBIB of the 100% equity interest in Ideal Greencity Sdn. Bhd. (‘Ideal Greencity”). The 100% equity interest which comprises a total of 1,000,000 ordinary shares of RM1.00 each, was purchased for a total of RM994,000 with internally generated funds.

Following this acquisition, the new subsidiary, Ideal Greencity had ventured into property development activities. Its major upcoming project is a joint venture development project with Koperasi Kampung Melayu Balik Pulau Berhad, to develop 5 parcels of land measuring approximately 88.45 acres situated in Balik Pulau, Penang. This proposed integrated development will comprise of a resort/ hotel, 320 units of condominium, 360 units of low costs apartments, 67 units of double storey bungalow, 216 units of double storey semi detached houses, 222 units of double storey terrace houses, a private hospital, 24 units of retail shop and bazaar.

The proposed development is expected to carry a Gross Development Value (“GDV”) of approximately RM600 million over a period of 10 years. With this new injection of a wholly- owned subsidiary company into the Group, Ideal Greencity will be a new addition to the Group’s existing 7 development projects with a total GDV of 4.062b. The acquisition of Ideal Greencity is expected to contribute positively to the IUBIB Group in the long term.

Currently, 3 existing affordable housing projects undertaken by the Group are namely, One Foresta, Forestville and I-Santorini. These affordable housing projects which carries a total GDV of RM1.97b has received strong demands from purchasers and are now averagely 90% sold for each projects. Located in the established neighbourhood of Bayan Lepas and Tanjung Tokong respectively, the 3 projects have proven to be a popular catch amongst purchasers given its location and affordable pricing. Unbilled sales and remaining unsold GDV for the 1st quarter of 2019 stands at RM613m.

Meanwhile, 4 other projects within IUBIB Group had just entered into initial development stage and have achieved approximately 15% completion. Priced at an average of RM450,000 to RM600,000 per unit , these projects are located at strategic location within South West of Penang. The development projects which mostly comprise of apartment/condo units, landed houses, shoplots and office units, brings a total GDV of RM1.56b.