The Asia Pacific Property Awards 2011 in association with Bloomberg Television have just been judged and Mah Sing Group has been informed that it is amongst the winning companies.

Successful entrants have been invited to attend a high profile gala presentation dinner at the Longemont Hotel Shanghai on May 31. Mah Sing Group will then discover whether the company has won a five-star or highly commended award in the categories of Best Mixed-Use Development for its Southbay City in Penang project, Best Industrial Development for its i-Parc3 at Bukit Jelutong project, Best Retail Development for its Star Avenue at Damansara project and Best Website.

Group managing director Tan Sri Datuk Sri Leong Hoy Kum, and group chief executive said of the awards, “We are very pleased that our projects have been shortlisted to be among the best in Asia Pacific. Last year our residential projects won three awards, and this year, our commercial and industrial projects have been recognised for their outstanding concepts and design. Being one of Malaysia’s most diversified property developer, this recognition is a strong testament to the high quality that we place on each of our project. We also place high emphasis on communicating with our stakeholders though various channels, and thus we are very pleased that our website has been recognised to be among the crème of the crème in the Asia Pacific region. ”

The event is part of the long established International Property Awards and its award winners’ logo is recognised as a symbol of excellence throughout the global industry. Attaining one of these coveted awards is indisputable evidence that Mah Sing Group is capable of beating some exceedingly strong contenders within the highly competitive Asia Pacific property arena.

Later this year, the highest scoring winners from the Asia Pacific Property Awards will compete against other winning companies from Europe, Africa, the Americas and Arabia to find the ultimate World’s Best in each category. The Asia Pacific region has an enviable record of achievement at international level, having scooped seven World’s Best awards in the finals of both 2009 and 2010. No doubt the property industry will be watching and waiting to see if this record number of international wins can be matched or even beaten in 2011.

The judging panel is chaired by Lord Bates of Langbaurgh and consists of more than 60 professionals whose collective knowledge of the property industry is unsurpassed by any other property awards. This year’s judges include UK account manager of Google James Bacon; group chief executive of the National Federation of Property professionals Peter Bolton King; the Royal Institute of Chartered Surveyors (RICS) David Dalby; and the Royal Bank of Scotland (RBS) Mike McNamara.

SOURCE: The Star

THE Penang Government is getting fewer complaints from developers since the implementation of new housing guidelines for the island in the second half of last year.

State Local Government and Traffic Management Committee chairman Chow Kon Yeow said the number of visits made by developers to see him about complaints had gone down.

?The Penang Municipal Council has also become more pro-active and their work process has improved,? he told reporters after delivering a talk at the i-Property Talk organised by the Red Tomato Penang Free Newspaper. His topic was on how the local government could help developers.

State Town and Country Planning, Housing, and Arts Committee chairman Wong Hon Wai, who launched the event, said MPPP had received seven applications for housing development projects on the island under the new state housing guidelines.

?In return for higher density, developers have to abide by certain conditions such as selling 5% of the project?s units below RM200,000, 5% below RM500,000 and 10% below RM300,000,? he said.

Real Estate Housing Developers? Association Penang chairman Datuk Jerry Chan said that the revised guideline for density on the island allowed a built-up area of 2.8 sq ft to be developed for every sq ft of land compared to less than 1 sq ft for every sq ft previously.

?This guideline, however, does not apply to developers who want to build super condominiums,? he said.

SOURCE: The Star

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Last November, Bank Negara introduced a macroprudential measure to curb speculation in the property market. Buyers of third and subsequent properties were required to pay a minimum downpayment of 30% of the purchase price.

Four months into that ruling, Bank Negara’s monthly statistical bulletin showed that for four consecutive months since November, the number of loan applications for residential property has reduced. Observers and analysts say a minimum of six months are needed to conclude if this anti-speculation measure is working.

Nevertheless, there is reason to believe that there are property buyers who are trying to negotiate around this ruling with the help of bank officers and agents because they want to pay a downpayment of only 10%.

How widespread this is today is just a matter of conjecture. Bank officers are not likely to confirm this. Banks will also want to lend out as much as possible. Agents will want to protect their own interest as they want to sell as many properties as possible. The same goes for the developers.

There are different ways to circumvent this ruling. The saying, where there’s a will, there’s a way certainly seems to ring true.

On the part of the buyer, it is learned that some are topping up the difference with a personal or a business loan. Another way to do it is to buy the property with a sibling or to use the name of children who are working. The combination of two salaries results in a larger loan when only one person may be actually paying for the mortgage. The risk, therefore, falls on the borrower who will be responsible for the mortgage.

Group chief economist at RAM Holdings Bhd Dr Yeah Kim Leng says it is possible for bank officers to “structure” loans such as topping up with personal loans to circumvent the 70:30 ruling particularly when they are convinced about the customers’ credit profile and repayment ability.

He says such overlending risk is likely to be isolated given that it is detectable through the centralised credit information system used by all banks. Obviously, if the circumvention becomes prevalent, it will dent the effectiveness of Bank Negara’s macroprudential measure to curb excessive speculation in the property market. Nevertheless, the banking institutions and the regulators have to be alert against such practices as isolated problems tend to become system-wide when there is excess liquidity and intensifying competition in the loans market, he says.

On the part of the developer, there are also developers who are trying to negotiate around this ruling. Buoyant though the property may be, there are developers of certain segments of the property market who may find it a bit challenging to sell, coupled with the pricing they are asking as well as the location of their projects.

Because their revenue is dependent on sales and because they want to “catch” the market as quickly as possible before the situation turns, they offer a rebate as an enticement. By offering a 20% rebate on the property price, they effectively enable the purchaser to make a downpayment of 10% and have the rest in the form of a 70% loan, which meets Bank Negara’s criteria.

In this case, the developer absorbs the loss while the buyer “gains” a 20% discount of the selling price. From the consumer standpoint, this is a better way rather than topping up with a personal or a business loan.

Whichever route a buyer takes, there is some element of risk involved, as with any investment. Globally, we are not out of the woods and on a national that Sarawak election is something to watch. We won’t have to wait long, though. On a regional basis, inflation is running high, although Malaysia’s inflation rate of 2.9% as of February is considered among the lowest in the region.

A statement by Bank Negara says the 30% downpayment requirement was put in place to curb speculative activity in the property market and to promote the continued affordability of homes for the general public.

The provision of additional financing facilities (such as personal/company loans) together with housing loans as a means to circumvent the loan-to-value ratio limit would be inconsistent with the intended objectives of the measure and is not a practice that the Central Bank considers acceptable.

Bank Negara will continue to monitor the practices of banks closely, and will act against institutions found to be facilitating or encouraging the circumvention of the measure, the statement says.

SOURCE: The Star

First time home buyers who are daunted by soaring prices of residential properties in the Klang Valley should not wait in the hope of a softening in the property market.

Prospective new home buyers may want to take note of rising construction costs that are driving up property prices, as well as possible further interest rate hikes in view of the consumer price inflation hitting a 22-month high of 2.9% in February.

On Wednesday, SP Setia Bhd president and chief executive officer Tan Sri Liew Kee Sin said he expected home prices to rise by at least 10% this year, depending on location, to reflect higher construction costs.

“Property prices will not drop as the costs do not allow this anymore,” said Liew during the Invest Malaysia 2011 conference in Kuala Lumpur.

Meanwhile, a recent report from Hwang DBS Vickers Research says that as a proven inflation hedge, property should remain in demand even with potential interest rate hikes.

The report says while it is believed that the 70% loan-to-value cap managed to cap speculative activities to a certain extent, strong underlying demand from first-second home owners and upgraders has continued to support recent property sales, even at new benchmark prices.

The 70% loan-to-value ratio satisfies Bank Negara’s ruling (announced last November) which requires buyers of third and subsequent residential properties to fork out 30% downpayment.

Also, a recent survey by the Malaysian Institute of Economic Research (Mier) on residential property in the country says an astounding 61% of housing developers who responded to the survey had adjusted their prices of their residential properties upwards in the first quarter of this year – the highest proportion garnered since the third quarter of 2008.

None of the respondents in the survey had lowered their prices.

However, the Mier survey report concludes that pressure exerted by high costs of raw raw materials, fears of rising oil prices, and the interest rate factor could all combine and impact negatively on the sector in the coming months.

“This is likely to impinge on the future growth of outlying areas, and may also dampen the revival process of developments

that are currently suffering from low take-up rates, low population inflow and an overhang problem,” said the report.

SOURCE: The Star