The Penang state government should implement clear-cut housing policies that suit the overall property market conditions, real estate agent Michael Geh said today.

The chartered surveyor said the state must consider the effects of the policies implemented on both the primary and secondary markets.

“I hope the state will implement policies that will not negatively affect the housing sector.

“We must remember if there are higher developer levies and higher land prices, it will only lead to higher house delivery costs that the consumers have to bear,” he said at a press conference to announce the Penang Property Summit 2017 slated for March.

The senior partner of Raine and Horne International hoped the state does not only consider developers’ interests when implementing housing policies.

“I hope the policies implemented will also be more sensitive towards the secondary market,” he said.

The primary market refers to new launches by developers while the secondary market refers to properties put up for resale either by house owners or through estate agents.

As for the 2017 property outlook, Geh predicted that the property market will see a slight surge from the final quarter of 2016.

“So, I am predicting an increase in residential property transactions in the first quarter of this year by about 5 per cent,” he said.

He expects Penang to record about RM1.13 billion worth of transactions for 2,527 units within the first quarter of this year.

“The market will remain robust especially in the secondary market which is more active than the primary market with a ratio of five to one,” he added.

State executive councillor Jagdeep Singh Deo who also attended the press launch noted a drop in transactions for the second half of 2016.

“Despite the outlook not looking very bright , we still believe Penang is the place to invest in,” he said.

As for the state’s housing policies, Jagdeep said events like the Penang Property Summit is important to allow the state to gather feedback from stakeholders.

“The last few years, it is because of engagement with developers, we know developers are hit badly so we try to tweak our policies to fit the market,” he said.

Source: TheMalayMailOnline.com

Despite market softening, the secondary housing market still offers the best value in terms of price and value.

Malaysian Institute of Estate Agents (MIEA) past president and chief trainer K. Soma Sundram said the secondary market would continue to move the real estate business this year.

“Many don’t realise this. It is the secondary market transactions that move the real estate business, making up to about 80 per cent of the real estate transactions in the country.

“New projects account for between 20 and 25 per cent. It is the secondary market that drove the market last year,” said Soma Sundram.

Providing an overview of the current condition, Soma Sundram said the property market was still finding its direction and it was a matter of supply and demand.

“I see there is more supply than demand, and the demand is based on factors such as income level, financing and so forth.

“Prices have gone up and its good that the market is going through this period.

“It is now finding the balan-
ce where it should go from here on,” he said, adding that in the long run,
it would help the market correct itself.

Touching on the activities of illegal real estate agents in the country, MIEA deputy president Eric Lim said apart from a wider awareness, there must also be a stronger regulations and enforcement to curb the activities of these agents.

“Bulk of the real estate agents registered under the Board of Valuers, Appraisers and Estate Agents Malaysia (BOVAEA) are concentrated in clusters in the Klang Valley, Penang and Johor.

“In other states, since the activities are rather scarce, these agents thrive on unregistered transactions,” he said, highlighting that East Malaysian states were among the highest.

Lim, who is also the BOVAEA’s
Estate Agency Practice Committee (EAPC) chairman, said for the past three years, the firm has been educating the public and creating awareness on the dangers of transacting with illegal agents, in mediums such as print and electronic media.

“We try and educate the public not to respond to illegal signboards on the streets, not to deal with them as they are not registered.

“If at any moment the deal goes wrong, victims would not be able to recover their losses,” he said, adding that EAPC is working with the relevant government agencies to trace and bring the illegal real estate brokers to justice.

Read Source: New Straits Times Online

It has been a quiet year for the Penang housing market in 2016. The cooling measures and tighter credit environment have continued to negatively influence the local market. While many are hoping to see a recovery soon, recent disappointing economic performance has further dampened market sentiment. Buyers are adopting a “wait-and-see” strategy as they remain uncertain of the economy’s future.

The delay in the issuance of advertising permit and developers license (APDL) has also contributed significantly to the decline of property transactions in Penang. Without the APDL, developers are not able to sell and promote their projects, nor can they finalize sales and purchase agreements.

The chart above makes it clear that home sales have slowed down over the past three years and are expected to continue that trajectory in 2017. To get a sense of just how much sales have dropped in the past two years, consider the latest data from NAPIC, which indicates that the total housing transactions in first half of 2016 have dropped 13.5% and 25.8% compared to the same period in 2015 and 2014 respectively.

Prices rise despite slower market

Unfortunately, slowing transactions don’t mean that home ownership will become more affordable. PenangPropertyTalk.com experienced record website traffic in 2016 with over 1.79 million visits, beating 2015’s record of 1.61 million by approximately 10%.

There is actually a straightforward explanation for this: People’s obsession with home ownership is not fading, but they are adjusting their risk appetite and waiting for the right deal.

The figures below show the average transacted value for the three most common residential property types (condo, two-to-three storey terrace and semi-detached) in Penang. Undeniably, house prices have generally seen an upward trend, with the exception of condominium and terrace houses located in south-east district of Penang Island.

The landed house prices on the Mainland have shown steady growth over the past two years as upgraders are looking for bigger space for their growing family. The average transacted value for a semi-detached house in Penang Island also registered double-digit quarter-on-quarter growth in Q3 2016.

Deep-pocketed investors look at investing in landed houses as solid investments not only because it comes with a solid land, but also because it is less speculative as many make these their homes. Certainly, the scarcity of land will continue to drive up property prices, particularly for landed houses.

Opportunities during slow markets

The supply of affordable housing has influenced a fundamental shift in the Penang high-rise market, moving it out of rapid recovery and into a new normal where slow growth will stay for the long run. Thus, first home buyers can look forward to a more stable market with ample time to make the right decision. If none of the existing projects appeal to you, keep a lookout on the upcoming affordable houses located in Bayan Baru, Gelugor and Jelutong this year.

Concerns about further depreciation have also kept many people from buying houses during slow markets. However, by recognizing the opportunities that slow housing markets present, prospective buyers can break away from the pack and take advantage of good deals. If you scout around, you will find almost all the developers are now sweetening their deals with freebies, discounts, rebates and other innovative financial assistance schemes.

Penang Mainland – Full of possibilities

As land becomes more expensive on the island, developers are moving to build on the mainland where the abundance of land offers greater opportunities. Exclusivity and lifestyle will be the key development theme — a differentiation strategy which influences the expectation of a new living standard.

EcoWorld’s maiden project at Simpang Ampat, Eco Meadows, is a perfect example of how differentiation plays a vital role in influencing a buyer’s perception of value, setting it apart from the neighboring projects. Prices start from RM700k when it was first launched in late 2015, almost double the price of the surrounding houses and on par with the houses in a remote area of Penang Island. The project is nearly sold out now.

Infrastructure plan is too early to assess

The Penang Transport Master Plan (PTMP), the biggest infrastructural undertaking in Penang’s history, was one of the hottest topics discussed in 2016. It will be the greatest catalyst for the property market in the northern region, and it will help to create a more equitable housing situation for all by making remote township more accessible. Unfortunately, these plans are still too nebulous to have any material effect on the housing market in 2017.

Highlights in 2017

For first home buyers, keep a lookout on a few more affordable options coming up at Bayan Baru, Gelugor, Jelutong and Batu Ferringhi, including two projects by PR1MA.  Choose wisely within your means. A branded location does not necessary mean the right location for you.

Properties in a prime location with a price tag of around RM700k-RM800k are expected to enjoy good take up rates. If you have that budget, stay tuned for the upcoming condominium by IJM — 3 Residence and Waterside Residence, and the mixed development by Temasek — BPO Prime at Bayan Baru. Looking for high-end options? Check out the upcoming Marriott Residences at Gurney Drive, Penang Straits Residence at Seri Tanjung Pinang or wait for the new launch of landed properties by E&O property.

Gated and guarded communities on the Penang Mainland remain the ideal lifestyle choice at relatively affordable prices. Check out some of the existing projects before they get out of reach. The upcoming gated and guarded development by EcoWorld (Eco Horizon) and Aspen (Viluxe) at Batu Kawan will set a new price benchmark for properties in Mainland.

Still wondering would the property market recover in 2017 or 2018? Let’s put aside the word “recovery” and recognize the current market as a new normal. New growth will start from here.

– Ken Lim
(Founder, PenangPropertyTalk.com)

GM Training Academy are collaborating with MIEA Penang to organize training for real estate agents. The trainers (Richard Oon, Chris Tan, Elane Goh and Miichael Yeoh) are well known in their respective field with an average of 15 years experience.

Currently this is waiting for the Board of Valuer to approve 10 CPD points. This is a course for all real estate industry players. You will be able to enhance your knowledge after the 2 days 12th and 13th January 2015.

Click here to find out more details

 [Sponsored Ad]

BPO Prime, an upcoming integrated mixed-development, is a joint venture between Penang Development Corporation (PDC), Temasek and Economic Development Innovation Singapore (EDIS).

Strategically located on a 2.7-hectare site in Bayan Baru, it will provide commercial space focusing specifically on business process outsourcing (BPO) activities, as well as residential space. The four-storey PDC building, currently located on the site, will be replaced by a proposed 29-storey and 25-storey BPO towers, which are being planned to accommodate retail outlets, recreational facilities and open spaces.

The project is currently in planning stage, its residential component is slated to be launched in early 2017.

Project Name: (to be confirmed)
Location : Bayan Baru, Penang
Property Type : Mixed development
Total Unit: (to be confirmed)
Built-up Area: (to be confirmed)
Indicative Price: (to be confirmed)
Developer: PDC / Temasek / EDIS

Location Map: