Demand, prices to remain strong

Property News/ 21 February 2013 Leave a comment

STRONG OUTLOOK: People willing to buy but it’s very selective and not across the board, says MIEA president

THE secondary residential property market is expected to remain strong this year with prices continuing to rise if the current stock remains tight, the Malaysian Institute of Estate Agents (MIEA) said.

Its president, Nixon Paul said based on a survey done by MIEA, the number of properties available for sale where the asking price is close to market value was low.

“The market is there. People are willing to buy and there is a lot of activity but it’s very selective, not across the board,” he said at a media briefing yesterday.

According to Nixon, residential terrace and semi-detached houses would remain the best sellers this year.

He added that the condominium market, which was badly hit because of the sub-prime crisis in the United States, will stand to improve this year.

“Our prediction for this segment is that it will continue to grow. Rentals are expected to slowly improve through 2013 as more projects under the Economic Transformation Programme start to bear fruits and many expatriates are relocating here,” he said.

For industrial properties, Nixon said the rental markets in Johor and Penang are getting more attractive.

He said the situation is more vibrant in Penang because of a shortage of new industrial space.

“Industrial properties are mostly taken up by the electrical and electronic industry, which is thriving in Penang. Rentals continue to increase and this has made the market more attractive than the Klang Valley,” he said.

For Johor, Nixon said the success of the Port of Tanjung Pelepas as well as better political relations between Malaysia and Singapore have helped to improve the demand for industrial space in the state in the past few years.

Meanwhile, based on a survey carried out by the Real Estate and Housing Developers’ Association Malaysia (Rehda), it has been estimated that the overall cost of doing business has increased by 10 per cent to 20 per cent in the second half of 2012 and similar trend is expected this year.

From the total 170 respondents, 82 per cent said the Revised Real Property Gains Tax had a slight to moderate impact on them, while 74 per cent felt that the 50 per cent stamp duty exemption for properties below RM400,000 had impacted the sector moderately.

Overall, Rehda is upbeat on growth in the real estate sector for the first half of this year and the driving factors would include the economic stability and higher domestic demand.

Rehda president Datuk Seri Michael Yam Kong Choy said the existing trend of high demand and steady prices in 2012 will continue this year.

Yam also expects higher demand for strata residential properties this year.

“If the growth momentum remains steady, then we do expect the property market to remain firm for the rest of the year, primarily driven by domestic buying,” he said.

In terms of challenges, labour shortage, increasing cost of building materials, as well as obtaining end-financing for potential buyers will remain the concerns.

Source: Business Times

  1. Penang Homes
    February 21st, 2013 at 14:50 | #1

    Wah…. property owners must be jumping for joy…. again, however, remember to buy only property on Penang Island….. and also be selective…. choose landed properties if you can afford…. rental may be lower but prices appreciate faster…. in 5 – 10 years time… landed properties on Penang Island will only belong to super rich or those who inherit from parents….good luck everyone…..Kiong Hee Huat Chye

  2. PgKia
    February 23rd, 2013 at 12:08 | #2

    How abt Penang mainland? Today,average double storey terrace house already cost 350k to 450k. After 10 years, mainland property will be boost to another step value. More and more new fresh penang island ppl buy hse in mainland. Just my observe, nothing to offence island n mainland ya. We are 1 Penang Kia!!! ….yeah. ..

  3. condomana
    February 23rd, 2013 at 14:09 | #3

    Hi PgKia,

    As long as there is no major financial catastrophe, asset value (eg. property, stocks, commodities etc) would generally rise. So as property prices on island climb, same goes for those on mainland. But the question here is, where does it give you the best return for the Ringgit!?…:)

  4. Believer
    February 23rd, 2013 at 14:46 | #4

    Certain locations in B’worth for double storey terrace house costs 530k
    to 650k.

  5. nd4spd
    February 25th, 2013 at 09:06 | #5

    It will defnitely, more and more fresh ppl to pick mainland because of affordability. Again, this category belongs to ‘fresh’ like what you said. And because of affordability, you won’t see super condo, high end lifestyle residential in mainland. Well, this is bad because the gap is there..

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