The LRT line linking Komtar and Bayan Lepas, estimated to cost around RM7bil to construct, is expected to generate about RM2bil worth of jobs for the local construction industry, said Penang Master Builders and Building Materials Dealers Association.

Its president, Datuk Lim Kai Seng, said the first phase of the LRT, which involved soil investigation and alignment studies, had already generated about RM100mil worth of jobs for the local construction industry.

The proposed 30km LRT project will cushion property prices in Penang, according to Real Estate & Housing Developers Association (Penang) past chairman Datuk Jerry Chan.

“Although the volume of transactions has declined by about 30% in the first quarter compared to the previous year’s corresponding period, the price of properties, however, has not been affected yet by the decline, due to interest rates remaining at the same level, and high land and building construction costs.

“The other factor that will help to bolster property prices in Penang is the proposed LRT project. The project will definitely help (hold up) the property prices in areas where there is a high density.

“In popular areas of the island where properties are sought after, we will see prices moving up due to the accessibility of the LRT over time,” Chan said.

Zeon Properties Sdn Bhd chief executive officer Leon Lee said that the price of properties near integrated transportation systems in other countries was either stable or tend to move upwards most of the time.

He said infrastructure such as transportation centres and bridges were vital elements.

“The completion of a bridge connecting Shenzhen (China) and the New Territories of Hong Kong resulted in property prices in the surrounding areas escalating by about 155% over a period of 10 years.

“In 2002, the property price in New Territories of Hong Kong was about HK$2,742.69 per sq ft.

“It shot up to HK$7,007.38 per sq ft in 2013, which took only about 10 years,” Lee said.

Lee added that the price of property in Batu Maung had increased significantly when the second Penang bridge open.

“In 2007, a terrace house in Batu Maung was worth about RM700,000. A similar unit now is priced at RM1.4mil. This proves my earlier point (about bridges),” he said.

The Komtar-Bayan Lepas LRT is the state’s first rail network proposed under the RM27bil 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 development. It is expected to provide a fast route to the airport and will traverse densely populated residential, commercial and industrial areas.

* Click here to find out more about Komtar-Bayan Lepas LRT stations *

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. The alignment also factors in interchanges with future LRT, Sky Cab and monorail lines that are being planned, including one that will cross the channel to connect Gelugor with Penang Sentral in Butterworth.

Source: TheStar.com.my

Members of Rehda Youth, the youth wing of the Real Estate and Housing Developers’ Association Malaysia (Rehda) always have their fingers on the pulse of the property industry. These young developers keep abreast of the challenges and trends in the market and are well aware of the buying behaviours of their target market.

As capable leaders of dynamic, market leading property development companies, they have solid advice for property buyers. These are their views:

Carrie Fong, director of Hedgeford Sdn Bhd and chairman of Rehda Youth

Tell us about new developments in the market. How do these projects meet the needs of property buyers?

Property buyers in the market now are mostly first-time homebuyers or homeowners who need a bigger space. Their lifestyles tend to be busy, and time is of the essence. A home is a sanctuary and a development should be self-contained, so residents don’t have to go too far to get to the food and services they need. Ideally, everything should be accessible on foot. A better home is efficient, giving the owner more time for his or her desired lifestyle.

I firmly believe that a better home is connected to a strong community. It is so important that a community integrates and people get to know each other. In some suburbs, no one knows their neighbours.

All developers want a strong community living in their developments. To get this going, we need to provide facilities and outdoor spaces for residents to come together and network. But building community spirit and civic-mindedness does not happen overnight. Getting the majority to stop dropping litter is an example. Why not use the garbage bins instead of leaving it on the ground for the next person to trip over? Building a sense of responsibility and a sense of community takes a lot of effort. And, results, if any, are only seen after a number of years.

Who are the property buyers in the market?

Property buyers are no longer state specific. Globalisation and the diaspora of Malaysians overseas means that property buyers are based everywhere. I find that Malaysians living overseas still want to buy a home here.

Technology has helped developers in this respect. Our sales consultants can be based anywhere and sell a project that is located in the Klang Valley to a buyer who is not even living in the country.

Technology has also enabled us to receive much more customer feedback than ever before. This could be a bad review that has gone viral or something that is said on social media. Communicating with our buyers and potential buyers is part and parcel of our business. It is a tedious process but it must be done in an open and pleasant manner.

Ng Choon Keith, executive director of Kota Kelang Development Sdn Bhd and treasurer of Rehda Youth

Are green developments passé or are they here to stay?

In the past, green features in a property may have been more of a marketing gimmick than a sincere effort to minimise the building’s energy consumption. Now, more and more developers are seeing the value of incorporating green features and using eco-friendly products. New innovations can speed up the construction process and lower maintenance cost for the developer and homeowners. And it can reduce a project’s carbon footprint. What’s not to like?

I see an increasing number of developers building developments that meet the requirements of green certifications such as Redha’s GreenRE. I believe that green homes will soon be the minimum standard expected by property buyers.

Have you noticed any other trends in the property industry?

In recent years, developers have been building homes and furnishing them. The idea is to allow buyers to pack their suitcases and move in. But I’ve noticed that homebuyers who acquire landed property are keen to renovate. Sometimes, they start renovating the minute they get the key to their house.

Now, giving an empty house, what is described as an empty shell, is starting to make a lot of sense. It saves cost and reduces wastage. Maybe homebuyers should be given the option of having their unit completely fitted out or taking an empty shell.

Any advice for homebuyers?

I agree with Shanaz Muztaza (from Fairview Group of Companies) and advise homebuyers to read the terms in their sales and purchase agreement (S&P). This is especially true for commercial properties with residential units.

The S&P for residential properties must comply with the terms and requirements set by the Ministry of Urban Wellbeing, Housing and Local Government. So, these agreements are often considered ‘standard’. But this is not the case for commercial properties. While the template may look similar, a developer can add specific clauses. For example, there can be a clause that says doors will not be provided. If a buyer is unaware of this clause, he or she will be completely surprised when the unit is handed over.

Shanaz Muztaza, director of Fairview Group of Companies and Rehda Youth committee member

What are property buyers looking for?

Buyers want safety, security, green homes and access to amenities. In short, I would say they want value for their real estate investment. They also appreciate options. More choices for the buyer add value to the property. As developers, we are keen to provide them with options.

Buyers are very sophisticated now and they appreciate the finer details. For example, we offered our homebuyers the option of using non-toxic child-friendly paint that is easy to clean and the response was good.

I see an emerging trend for clean-cut designs for landed property. Homeowners like to renovate their houses as they see fit. We can maximise the built-up area for a landed residential unit but we choose not to do this. This way, the homebuyer can do as they please. Perhaps developers will start to give their customers the option to remove the fixtures and fittings that are commonly offered in any new landed development now.

Do you have any advice for potential property buyers?

Buying a property is a huge investment and potential buyers have access to a lot of information on social media. I would urge them to seek out the facts after listening to one opinion. Then, balance all the information that you receive. Fortunately, a lot of people are already doing this. As mentioned, property buyers are sophisticated and savvy.

Developers must adhere to a lot of regulatory requirements. This industry is well regulated and we are legally required to regularly report on our progress. So, potential buyers can always approach us to fact check.

I would also advise everyone to read the S&P. This is especially important for properties built on commercial land. Contracts are based on a willing seller, willing buyer agreement, so the assumption is that you know what you are buying. I also think it is important for property buyers to consciously prepare themselves for the environment they will live in. If there are shared spaces, then ideally, they should embrace the communal mindset when they decide to buy a unit there.

Wong Wen Chet, managing director of GCPG Holdings Sdn Bhd

Have you noticed any new trends in the property market?

The internet is slowly changing our sales channels. Previously, property buyers had to go to the developer’s showroom to get information about new developments. They would go to several developers and this process would require several weekends. Now, they go online. In one day, they can compile a spreadsheet comparing 10 or more different projects. Online information is pervasive and developers are taking this into account when they market and sell their new developments.

Property buyers should consider the developer’s track record. This is a capital-intensive industry and a lot of money is needed just to buy the land for the development. This means that we must be able to manage our financials for the long haul. It can be challenging, especially when margins are compressed. A number of listed developers have reported single-digit margins in their annual reports. This says a lot about the complexities developers face. Yes, some developers may be able to build something that is sold at a premium, but this is more the exception than the rule.

How else has the internet affected developers?

A negative online review that goes viral affects all industries, not just property. Unfortunately, it is usually bad news that spreads quickly. I would like readers to consider the big picture when they read of a person’s bad experience. Maybe the developer has a project that satisfies 98% of customers and one or two buyers have a bad experience. They go online and their reviews go viral. That is not necessarily a bad thing, but I do encourage homebuyers to go to other sources. Look at the big picture. Look for the facts. Ask for different perspectives. Then make a decision.

Chan Kin-Meng, CEO of Beneton Properties Sdn Bhd and immediate past chairman of Rehda Youth

What is needed in the property industry?

Developers build homes for the open market. Buyers and developers are exposed to global trends and are very well travelled. So, trends will keep changing, especially as developers keep evolving to meet the needs of property buyers.

I believe that more can be done to improve the industry. For example, policies and regulations should be more accommodating. This would support developers in their quest to give property buyers the best possible home at the best possible price to live their desired lifestyle.

The implementation of the Goods and Services Tax (GST) last year is an example. Residential homes are exempted from GST. However, the fittings and fixtures within a house incur this consumption tax. This means that developers have to incorporate another company that is registered as a GST entity. All the transactions that incur this tax are charged to this company. From an accounting and compliance perspective, this is a lot of work for a developer who should be focusing on building the best possible home.

Some potential property buyers may be deferring their purchases now in the hope that prices will fall in the future. What is your view?

A lot of people ask me when is the good time to buy (properties). My answer is: It is always a good time to buy if you are financially able. Property is a long-term asset. The cost of construction is always going up. While the prices of commodities are holding steady now, the cost of labour is going up. The price of land is probably the biggest cost element for all new projects.

Now is an ideal time to buy because the property industry is very innovative and there are many good projects on the market. It is a very competitive industry and this is reflected in the quality of homes and the choices that are available to property buyers.

Source: TheEdgeProperty.com.my

Ideal Property Development Sdn Bhd, the parent company of Ideal United Bintang Bhd (IdealUBB), will initiate a corporate exercise in the second half of this year to inject RM1bil worth of properties into IdealUBB.

The properties are priced below RM600,000.

“This is part of an on-going corporate exercise over five years to turn IdealUBB into a property company.

“We will initiate the corporate move after June, when IdealUBB closes its second quarter,” said Ideal Property executive chairman Datuk Alex Ooi.

According to Ooi, the company plans to undertake RM2.723bil worth of condominium projects on the island this year.

Of the amount, the group had launched the RM378mil Summerskye Residences in Bayan Lepas in January.

The upcoming projects, comprising 3,648 units, to be launched between May and November are located in Bayan Lepas in the South-West District, which is close to the Penang International Airport and the first and second bridges.

The projects are Forest Ville with gross development value (GDV) of RM495mil this month, Bukit Ayun Development (RM1bil) in August, Queens Residences (RM550mil), and Amarene (RM300mil) in August.

Besides the Queens Residences and Bukit Ayun Development projects which will be priced between RM600,000 and RM900,000, the rest of the schemes are priced between RM450,000 and RM600,000.

“Some of these projects are among those that will be injected into IdealUBB this year.”

Ooi said that while most developers were holding back launches, the group had decided to go ahead with a variety of property products priced between RM450,000 and RM900,000.

According to Ooi, properties within such a price range are still marketable, especially if the location is strategic.

“The group still has about 10,000 units of affordable homes, priced below RM400,000, which will be launched in the island over the next few years, and they will be injected into IdealUBB eventually.

“These 10,000 units will have an approximate GDV of RM3.8bil,” he added.

Ooi said the group had developed 3,498 units of affordable projects on the island for the last two years.

“We have sold about 60% of these properties.

“Moving ahead, the strategy is to move into the range of between RM400,000 and RM600,000,” he said.

Because of the number of condominium projects Ideal Property launched per annum, Ooi is now frequently referred to as the Penang Condo-King.

Ideal Property has 300 acres of land bank on the island. “We have some 25,000 units of properties planned for the land bank.

“About 20,000 units has been approved for more than 10 projects. But these properties will have to be injected into IdealUBB over a period of time in accordance with Security Commission regulations,” he said.

Ideal Property injected the RM925mil I-Santorni into IdealUBB last year.

I-Santorini, in Tanjung Tokong, comprises 2,155 units of condominiums priced below RM400,000 each.

To date, the project is 60% sold.

Source: TheStar.com.my

Raja Uda and Bukit Mertajam are two higher intensity development areas in Seberang Perai. Raja Uda, an upcoming development area is located in the northwest region of Seberang Perai and lies beyond the KTM rail corridor. The proposed Raja Uda-Bukit Mertajam Monorail line will provide much-needed connectivity between Raja Uda in the northwestern region and Bukit Mertajam in the southeastern region of Seberang Perai.

For the initial stage, the monorail line is proposed to begin from Raja Uda, passing through Sg Nyiur, Seberang Jaya, Bukit Tengah, Bandar Perda, Bukit Mertajam and continues on to Alma and terminates at Permatang Tinggi. The line will serve the Penang state administration offices at Seberang Jaya and Bandar Baru Perda.

Potential extensions of the transit line to further areas can be in the form of a BRT system:

• From Raja Uda towards Kepala Batas in the north
• From Alma towards Kulim in the east.

These identified transit corridors can be reserved as part of the State’s planning process.

* Click here to find out more about Penang Transport Master Plan (PTMP) *

Mark your calendar and visit PI’s Property Showcase at Queensbay Mall this coming weekend! You will have a chance to meet the experts for tips and guides on investment strategies.