A strong recovery in 2021 from 2020 has signalled a return of consumer confidence and an improved property market this year, said the Malaysian Institute of Estate Agents (MIEA).

In a statement today, MIEA president Chan Ai Cheng said that more importantly, the public must take heed of the fact that the house price index has seen a significant increase to RM320,000 from RM295,000 in 2020.

According to MIEA’s latest property market report, the volume of transactions for 2021 rose by 1.5 per cent to 300,497 units with a value of RM144.87 billion, an increase of 21.7 per cent over the same period last year, she said.

“The percentage increase may seem small but it signifies recovery.

“The last quarter of 2021 had seen a sparked increase in the volume of transactions amounting to 99,462 units, which we believe could be largely due to the Home Ownership Campaign (HOC) incentives which ended in December 2021,” she noted.

As in previous years, Chan shared that the residential sector was the strongest, contributing 66.2 per cent with 198,812 transactions with a value of RM76.9 billion, while the agriculture sector recorded 18.9 per cent and the commercial sector contributed 7.5 per cent of transactions.

The following states contributed in excess of 50 per cent of the total transactions, namely Selangor (61,507), Perak (36,893), Johor (36,145) and Kedah (25,077), she said.

The report also highlighted that a total of 43,860 new residential properties were launched in 2021, comprising 31,678 (43.3 per cent) landed properties and 13,182 (25.9 per cent) high-rises.

However, it noted that only 39.3 per cent of the units were sold, resulting in an overhang of 36,863 units, which was the highest in the last five years.

The report also said that this scenario would concern developers as this could affect their cash flow.

“We need to caution buyers not to be overly alarmed by the rise in the overhang numbers as this may not be a reflection of how the property market is doing.

“Some properties are just not cleverly developed, hence the poor demand but this has nothing to do with whether the market is doing well or not,” Chan explained.

She said MIEA views the overhang as largely due to the lack of research resulting in a poor understanding of supply versus demand as well as a mismatch in the type of property price range that buyers are seeking in specific locations, among others.

Chan suggested that the local authorities should perhaps put a pause on similar developments in the vicinity of high overhang units to allow time for the market to absorb the units or to relook into the development composition before approvals are given to proceed.

“We feel it is time for the government, through the Ministry of Housing and Local Government, to intervene by adopting stricter guidelines or standard of procedures towards building approvals at the state level to provide check and balance and not to waste resources which may run into billions,” she said.

She also urged developers who are struggling with overhang units to work with real estate agencies to help ease the sale of these units, especially small developers who normally use their own in-house sales team to market.

“Appointing estate agents to help is a logical choice as they are trained and have the relevant experience.

“Be sure to only appoint those who are registered with the Board of Valuers, Appraisers, Estate Agents and Property Managers Malaysia (BOVAEP),” Chan added.

Source: Bernama

If there is to be a tunnel under the sea between the Penang island and the mainland, it needs to be at least 23m beneath the seabed – almost equal to the height of a seven-storey building.

This is among the critical technical considerations to ensure the port’s growth if the tunnel is built.

The Penang Port Commission (PPC) and Penang Port Sdn Bhd (PPSB) had sent to the state government yesterday a list for the state must consider if it wants to go ahead with the tunnel.

PPC chairman Datuk Tan Teik Cheng said the suggested tunnel depth was vital to cater to the future deepening of Penang’s channel to let larger ships sail into the harbour.It was earlier reported that the plan was to bore the tunnel at a depth of 11m to 13m under the seabed.Tan said while PPC and PPSB welcomed the state’s intention to give Penang a third link between the island and the mainland, it was vital to factor in the future expansion of Penang Port’s services.

“We have always stressed that ships entering the harbour from the northern channel, especially large ones with a draft of 16m, need a minimum depth of 23m,” he said.

The width of the northern channel must also be maintained at 2.2km to ensure the safe movement of large vessels, he added.

“We have sent a written review stating our concerns on these and other issues on the undersea tunnel project to the state government on Wednesday,” Tan told a press conference at the PPC office at Swettenham Pier Cruise Terminal yesterday.He said PPC had also asked the state to review the construction of an artificial island near the mainland end of the proposed tunnel, in Butterworth’s Bagan Ajam.

“The construction of the island should be nearer to shore to prevent disruptions to North Butterworth Container Terminal’s (NBCT) activities. It may also be an obstacle to the future development of the container terminal,” he added.

PPC, on Feb 20, 2020, had approved plans to expand the NBCT, including the reclamation of 217ha and lengthening of the docks by 1.5km.Tan said PPC and PPSB found that the port’s expansion had to go northwards because at the southern side of Penang lies Penang Water Supply Corp’s twin submarine pipeline and the cargo operations of Shell and Petron terminals.“We have been reviewing the undersea tunnel project since 2019 and sent a report to the state economic planning unit on May 20, 2020, with several suggestions on how it could be done,” said Tan.

“There is no change in our stand. We welcome the effort but the future of Penang Port must be considered for the sake of the state.”

The controversial 6.5km undersea tunnel and three main roads were among several projects forming part of Penang’s Transport Master Plan.It was reported on March 11 that no decision had been made on the construction of the tunnel.

Chief Minister Chow Kon Yeow had said the project’s concession company had presented its findings on the project feasibility study to the state exco last month.

He said the state had requested a written review from PPC and PPSB.

Source: TheStar.com.my

A proposed eco-tourism hub by Penang Development Corporation at Batu Kawan. It will be located on 46.77 hectares of land in the northern part of Bandar Cassia – The largest integrated township in northern Malaysia.

This project was showcased as Penang’s future eco-tourism hub during the recent Expo 2020 Dubai.

Proposed location:

DISCLAIMER: This article is solely based on research done using publicly available data. This is not an advertisement. Any claim, statistic, quote or other representation about a project or service should be verified with the developer, provider, or party in question.

Some improvements in housing market activity are visible heading into 2022, although the number of unsold houses remained high at 180,702 units in the third quarter (Q3) of 2021.

Disruptions caused by the pandemic partly contributed to the slower clearance of unsold housing stock despite ongoing home purchase incentives, said Bank Negara Malaysia (BNM) in its Financial Stability Review (FSR) for Second Half Review 2021.

Nonetheless, the high number of unsold houses continues to reflect pre-existing affordability issues, which have worsened since the onset of the pandemic as consumer incomes were affected.

In this regard, the supply-side adjustments have continued with more housing launches shifting towards lower and mid-price market segments.

The share of property launches priced at RM500,000 and below increased significantly in the third quarter of 2021 (Q3 2021: 88.1 per cent; H1 2021: 67.7 per cent; 2015-2019 average: 65.9 per cent).

This should help to cap a further significant increase in unsold housing stock, said BNM.

Nonetheless, the bulk of new launches remains beyond the affordable price segment, with only 35.6 per cent of new launches since 2015 priced below RM300,000, indicating further room for price and supply adjustments to improve overall housing affordability.

However, broader reforms to improve housing affordability remain critical to contain the debt burden of households and mitigate risks of future financial hardship.

Meanwhile, market activity is expected to improve in the fourth quarter (4Q) of 2021 driven by the resumption of economic activities. Correspondingly, higher loan applications were recorded across all price segments in the second half (H2) of 2021.

The significant increase in loan applications in the final two months of 2021 coincided with the Home Ownership Campaign that ended on Dec 31, 2021.

Improving employment prospects and the low interest rate environment would further support housing demand.

Demand for housing was largely driven by owner-occupiers, with 57.3 per cent (H1 2021: 55.8 per cent) of approved housing loans in the second half of 2021 granted to owner-occupiers.

In the commercial real estate (CRE) sector, BNM said the shift towards flexible working arrangements and the accelerated pace of digitalisation arising from the pandemic will continue to transform how physical spaces are utilised.

These trends could exacerbate existing oversupply concerns in selected CRE segments such as office and retail spaces.

Direct linkages between the CRE sector and financial system are largely contained, thereby substantially mitigating risks to financial stability.

However, further progress in resolving excess supply remains important given the high multiplier effects of the construction sector on the broader economy. Large planned incoming supply of office and retail spaces continues to pose risks.

For Malaysian real estate investment trusts (REITs), which are mostly funded by large institutional investors such as pension funds, this remained a nascent and small market, representing less than 3 per cent of total Bursa Malaysia market capitalisation.

Source: Bernama

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