An aerial view of Penang … high-rises in the state saw the most activity in the quarter under review, with prices increasing in all areas surveyed. Photos by Abdul Ghani Ismail

The Penang property market had an eventful first quarter, and the positive sentiments and values are expected to sustain, according to Raine & Horne International Zaki + Partners Sdn Bhd director Michael Geh. He attributes the upswing to the implementation of the Goods and Services Tax.

“In the first three months of this year, I saw people dashing to purchase a house from the primary market. As an observer of property fairs, I noticed that there was brisk business,” Geh says when presenting The Edge/Raine & Horne International Zaki + Partners Penang Housing Property Monitor for 1Q2015.

This observation, he adds, was confirmed by data from the National Property Information Centre (Napic), which was released recently. According to Napic, the primary market in Penang saw a 48.91% increase in total transactions to 4,095 last year, from 2,750 the year before. In contrast, the secondary market saw a 4.25% dip in transactions to 14,315, from 14,950 the previous year.

“Despite the loan rejections, I saw an upward trend last year and a continued upward trend of 3% to 5% in 1Q2015,” says Geh. Moving forward, he believes this trend will continue in the primary market, and expects to see another 5% increase in transactions.

He admits that he had been surprised to see the growth in the Penang property market, especially in the primary segment, despite the high loan rejection rate and restrictions in place.

“This is a significant trend,” Geh says.

One development that he believes will greatly impact the property market is the announcement of the Penang government’s plan for the light rail transit (LRT) alignment. To date, there are no details about the project but he is hopeful that it will be announced this year.

“The LRT is needed. This will be a game changer for Penangites,” he says.

As for the alignment, Geh believes the LRT will go through areas with a large population base. He thinks a good location for the main terminal would be somewhere near Menara Komtar, with a line passing through Jalan Dato Keramat and Jalan Air Itam, and then stopping at Jalan Paya Terubong.

He says the Air Itam valley — which has 30% to 40% of the island’s population — is the most populous area. A line along Jalan Kelawai, ending in Straits Quay, and one to the Penang International Airport would be good, he adds. He believes once the announcement is made, it will have an immediate positive impact on sentiments and property prices.

Terraced houses

For 1-storey terraced houses, the highest price gainers on the island during the quarter under review were those in Green Lane and Jelutong, both of which saw a 21.43% year-on-year increase to RM850,000 from RM700,000. On the mainland, houses in Seberang Perai Tengah rose 20% to RM200,000.

However, homes in Bandar Bayan Baru and Tanjung Bungah only rose marginally at 2% and 1.33% respectively. Geh explains that homeowners in these areas are just not selling.

Quarter on quarter, houses on the mainland saw a price increase, with those in Sungai Dua achieving the highest growth of 11.43% to RM780,000.

For 2-storey terraced houses, all areas surveyed experienced a price increase. Residences in Sungai Ara rose 26.67% y-o-y to RM950,000, followed by those in Sungai Nibong, which gained 25% to RM1.1 million. As for the mainland, Seberang Perai Selatan achieved the highest price increase of 27.27% y-o-y to RM280,000.

On a q-o-q basis, there were no changes seen in property prices, except for those in Pulau Tikus, which increased by 3.45%, and Sungai Ara, by 5.56%.

Semi-detached and detached houses

For the semidee segment, all areas saw a price increase. Houses in Island Park rose 27.91% to RM2.2 million from RM1.72 million a year ago. Those in Sungai Ara increased by 7.69%, Sungai Nibong by 6.06%, Sungai Dua by 7.14% and Minden Heights by 7.14%.

Q-o-q, only homes in Island Park (10%) and Sungai Ara (3.7%) saw price growth during the short time frame.

Meanwhile, a number of detached houses in the areas under survey saw price growth from the year before. Homes in Minden Heights saw a 25% increase to RM3.5 million, followed by those in Green Lane (16.67%), Tanjung Tokong (14.29%), Island Glades (12%) and Pulau Tikus (11.11%). Only residences in Tanjung Bungah showed no price increases, remaining at RM3.7 million since last year.

Geh explains that Tanjung Bungah is a mature neighbourhood with no available parcels to build on. Residents there are also not keen on selling their property. Nevertheless, like Damansara Heights in the Klang Valley, properties in Tanjung Bungah are much sought after.

In terms of quarterly results, there were no changes from the previous quarter.

Flats and condominium units

High-rises saw the most activity in the quarter under review, with prices increasing in all areas surveyed — both in the yearly and quarterly results. Geh says this was “because more people on the island prefer to stay in high-rises as landed properties are expensive”.

All 3-bedroom flats saw price increases, with those in Relau achieving the highest growth of 26.09% to RM290,000 from RM230,000 in the previous corresponding quarter. The second highest mover were flats in Bandar Baru Air Itam, which rose 11.11% to RM200,000.

As for the q-o-q performance, flats in Relau again achieved the highest price increase of 11.54%, while the rest saw single-digit growths.

All condos saw price increases as well, with units in Tanjung Tokong rising the most at 29.17% to RM620,000, followed by those in Tanjung Bungah (22.64%) and Pulau Tikus (19.23%).

Q-o-q, all units saw price increases, with condos in Tanjung Bungah (8.33%), Tanjung Tokong (6.9%) and Pulau Tikus (6.9%) being the top three performers.

Meanwhile, the overall rental market saw movements y-o-y, but q-o-q results were mainly unchanged. The rental rates of landed properties experienced more changes than those of high-rises.

Source: TheEdgeMarkets.com

Kensington Gardens, Parcel 1 of Jesselton Villas consists of freehold bungalow lots are guarded and surrounded by nature-inspired facilities and features. This exclusive development is strategically located within Batu Gantong, next to Penang Turf Club. It is only 5 minutes drive to Youth Park and Botanical Garden and close to all local amenities.

The current phase comprises 69 units of bungalow lots ranging from 5,995 sq ft to 9,634 sq ft in size.

Project Name : Kensington Gardens
Location: Penang Turf Club, Jalan Batu Gantong, Penang
Property Type : Luxury Bungalow Lot
Lot Size: 5,995 sq.ft. – 9,634 sq.ft.
Tenure : Freehold
Total Units : 69
Developer : Berjaya Properties
Indicative Price: RM 600 psf

Location Map:

* Article by Freemind Works *

Buying a property for the purpose of investment is one of the best decision one can make. However, deciding what to do with the property after we get the keys is another ball game altogether.

Click here to download the FREE E-book and discover how you can add value to your property with minimal cost

Look around you and you can see many projects completing and the owners will be getting keys soon in these coming months. In difficult times like this, not only are we faced with the challenge of finding the right property and getting our loans approved; we also now need to add value to our property to differentiate it from the other properties in the market.

My mentor and a good friend of mine, Adrian Wee, also known as the ID King, introduced to me the concept of Buy Renovate and Sell (BRS) and Buy Renovate and Rent (BRR). As promised, this is my second article on how you can add value to your property to get higher-than-market rental return.

Find out more on property investment strategies to get higher-than-market rental returns

If you who are planning to renovate your property soon, here are some interior design information that I’ve learned from Adrian Wee, the Renovation and ID Specialist. The below simple tips are some which you can adopt to add value to your property with a fraction of cost to produce maximum impact:

#1. Plaster Ceiling:
Add elegance and value to your space by using Light Box or Curtain Pelmet Light Box. The Design is simply achieve by using an L shape profile with the inside corner finished with a simple cornice. Usually Tubular florescent light T5 or Led rope light is concealed in the trough and light is reflected onto the ceiling. Gives a good indirect lighting expensive/high class effect to the room.

#2. Paint:
This may seem like a simple suggestion but a fresh coat of paint can do wonders for a house. It is cost-effective but raises value as freshly painted rooms look clean and updated. When your are selecting colours for the r0oms in your home, remember that neutral earth colours are best as they appeal to everyone and make your home more desirable. I always tell my client, every ringgit s.pend to upgrade a sub-sale home is a 10 times return for your investment on the paint work!

#3. Wallpaper:
Wallpaper may be harder to do than painting, but it will last for a good deal longer than paint will. In fact, many modern wallpapers will last for ten to fifteen years, whereas, repainting often has to be done as often as every couple of years, depending on your household. Wallpaper can last five times longer than paint under normal conditions, making it a very economical choice. Over time, you can save over 30 percent of your repainting costs, simply by choosing wallpaper. Installing a feature wall in the living or bedrooms gives visitor an upgrade perceived value with a lasting impression.

#4 Upgrade the Flooring:
Many people forget about upgrading the flooring. The higher the investment is, the better the returns, so going for wood, tile or natural stone to upgrade your floors gives it more perceived value. Vinyl flooring and low-end carpets are a no-no.

#5. Lighting Fixtures:
This is another simple solution to raise the value of your home. Invest in lighting fixtures and upgrade the existing ones. Using pendant lights and wall light can also make a big difference. You can give your home a face-lift and make it more attractive for people when you put your house on the market. These add-ons gives a higher perceived value to the space. E.g. Rewiring and adding down-lights on the other hand does not add impact to your visitor.

#6 Accessories:
Mix a few high-priced pieces with low-cost accessories. Make an investment in the pieces that will take the biggest beating that you need to last the longest like sofas and beds. Then pile on the inexpensive accessories that you plan on changing often like throw pillows and other decorative items. Do this with art, too. Mix affordable prints with one or two original paintings or sculptures.

Come and listen to the property investment strategies to get higher-than-market rental returns

These are some ways to improve your home and increase its value. Knowing how to do it cost effectively is a great way grow the value of your investment. Again, as I always share with my readers, don’t reinvent the design wheel, simply reproduce a room you saw in a magazine or on a design website to save you time and money.

Above are just some tips to Interior Design. There’s still so much more to learn. Bear in mind that this is not a one size fit all solution; you must look at your target market and type of properties you bought to apply the different ID ideas. In short, you can add value to all your property but you can’t apply the same ID ideas to all the property.

To find out more how Adrian Wee can help you to save 20%-30% of your renovation cost, come and meet him LIVE on 8 Aug 2015 in “Mastering Your Wealth”. Not only will he show you how you can save money through ID but also make money and a business out of it.

We have very limited seats left, ony 17 seats left. He doesn’t come to Penang often, don’t miss this chance to meet with him live in Penang.

So, book your seat early as we are expecting a full house. Now, people usually have to pay the retail price of RM129/pax ,

* BUT, I will give this deal to Penang Property Talk reader : You get all these learning for only RM57! And For 1st 17 people who register here NOW! will also get a FREE Penang map from Ho Chin Soon and other bonuses.

See you soon.

Happy Investing,
Keegan.

Keegan Tan is a Property Investor and Property Coach. He has coached more than 200 Penangites who have bought their property no money down. He is also the Founder of Freemind Works, an organisation that empowers individual to achieve their dreams through continuous education. Keegan has been featured in the News Straits Times and Property Insights. He has also spoken in Property Expo and Property Convention in front of a crowd of more than 300 people.

[Sponsored]

Merbok Signature, an upcoming mixed development by Sunny Homes at Nibung Tebal, Penang. It is adjacent to Residensi Merbok by Asas Dunia, just a mere minutes drive from Jawi tol plaza. A quick check from Google map shows that it only takes less than 30 minutes drive to go to Batu Maung via Second Bridge during peak hours.

This development comprises:

• 10 units of 3-storey shop offices
• 12 units of 2-storey link bungalows
• 62 units of 2-storey semi-detached houses
• 112 rooms 9-storey hotel

Property Project : Merbok Signature
Location : Nibong Tebal, Penang
Property Type : Mixed development
Tenure : Freehold
Total Units: 62 (semi-d), 12 (Link bungalow), 10 (shop office)
Developer : Sunny Homes

Location Map:

[streetview width=”100%” height=”250px” lat=”5.184703″ lng=”100.48624700000005″ heading=”-81.19620440943191″ pitch=”-14.102435393202697″ zoom=”0″][/streetview]

If you are aged between 18 and 34, then you are categorised as millennials, also known as Gen Y. At this age, it is a good time to consider investing in property.

Investing in property is certainly not easy, and most youngsters hesitate to invest due to several uncertainties. Long-term investing is challenging and needs a huge amount of patience and knowledge, but young adults have time as an added advantage.

The key benefit of property investment is increasing financial leverage. The value of most properties increase yearly, which makes it advantageous to invest from a younger age. A person who invested in their 20s is likely to be able to maximise capital appreciation as they allow the price to appreciate for a longer duration (provided their objective is to get long-term gains), compared to the investment made by a person nearing retirement.

Moreover, an investor’s age plays a role in determining the risk a person can withstand. The younger the person is, the more risk they might be willing to take on, compared to someone who is nearing retirement as they are at a different stage in life and might look at risk-free or lower-risk investments (unless they are a seasoned property investor).

Investing in property also means adding assets. When paid in full and managed well, the investment will remain an asset, while providing passive income monthly and capital appreciation. Kept for a longer time, this asset can also be passed on from one generation to the next.

Investing at a young age is obviously not an easy decision to make, but it is not impossible as well. With the right mindset and plan, it’s the best age to begin.

For a successful investment, young millennials should:

• Be in the know: Being tech-savvy is another advantage for Gen Ys, as there are apps, online courses, financial and educational property websites, blogs and social media, which offer valuable guidance. What matters most is getting your research done and get the right knowledge base before venturing into property investment. You should read up on books by financial and investment gurus, and attend talks and forums to get invaluable insights from property experts and investors. Learn from their mistakes and avoid the pitfalls of property investment.

• Consider a shared investment: Shared investment with a person who has the same passion or perhaps with parents or siblings is a bold move. Youngsters mostly fear the huge amount needed for their first property, which is 10% of the property value. Having a shared investment will ease the burden and make investing more appealing, while managing the risk to a certain extent.

• Buy to generate income: There are some young adults who are considering buying property for their own use, but the best investment is to rent out the property. The investor would get capital appreciation and monthly rental at the same time and it’s not necessary to fork out money each month. So it’s better to let tenants pay for your investment.

• Keep risks under control: Millennials should consider investing at a younger age, since that’s the best time to acquire a property and make the most out of their money and youth. As much as it is important to invest, it is also equally vital to keep the risks under control.  But it also depends on risk appetite, interest and financial management. For initial investments, choose an affordable property and always have a Plan B in case of emergencies. Have the “trading up” mentality, where you start with lower-priced properties and move up as you continue to invest.

• Choose the right property: To have a successful investment, it is important to choose the right property which will grow in value and attract potential tenants. You could start with smaller-sized units such as studio units and SOHOs priced below RM500,000. Of course, the location plays a major role. So it is best to evaluate the surrounding areas, the growth indicators and upcoming infrastructure, existing and future amenities, the developer (if purchasing new properties), and so on.

Source: StarProperty.my