GEORGE TOWN: The value and volume of construction projects that will be given out this year in Penang should increase by 10%, compared with 2012.

Penang Master Builders & Building Material Dealers’ Association president Lim Kai Seng said the first quarter of 2012 was slow for the industry, due to the uncertainty of the general election.

“According to the latest Construction Industry Development Board Malaysia (CIDB) report, in the first quarter 2012, the volume of construction jobs from both the private and government sector awarded in Penang was only about 10% of the total volume awarded in 2011, which was 514 with a value of RM6bil.

“Normally, the figure for the first quarter of the year should be around 25% of the previous year’s figure.

“The value of construction jobs awarded in the first quarter 2013 was approximately RM651mil,” he said.

About 15% of the construction jobs awarded in the first quarter 2013 for Penang came from the government sector.

“Now that the general election is over, we can expect more property launches to take off in Penang soon. This is why we are confident of more construction contracts to be awarded in Penang this year,” he said.

On construction costs, Lim said prices for building material such as cement and sand had remained stable since late last year.

“A bag of 50kg cement is still RM16.50, while the price of sand is RM40 to RM45 per cu metre, more or less the same as late last year.

“The costs of construction should remain like this till the third quarter,” he added.

To build a 1,000sq ft condominium in the south-west district of Penang today would cost around RM250,000, inclusive of land cost, Lim said.

Meanwhile, the Malaysian Institute of Estate Agents (MIEA) expects the prices of all types of strategically-located properties in the country to rise by 10% to 15% this year.

MIEA president Siva Shanker said the volume of property transactions should rise by 5% to 10 % this year.

“As the general election is now over, Malaysians with disposable income to buy properties are now in the buying mode.

“The real estate market has been getting more enquiries on properties in strategic locations the last few days after May 5, despite the complaints on the irregularities of the general election which have affected the feel-good factor,” he said.

Siva said last year, especially in the first half, there was a slowdown in the property market due to the tighter loan conditions imposed by banks.

“But now most of the people have got used to the banking guidelines for housing loan. They now have a better idea of the chances to get the kind of loan that they want, which will reduce rejection rate,” he said.

Siva said strategically-located high-end condominiums in the country, especially in Kuala Lumpur, would perform well.

“These projects used to command the interest of foreigners, but nowadays even Malay-sians are interested in buying high-end condominiums that come with lifestyle living,” he said.

According to the National Property Information Centre 2012 report, the volume of all property transactions recorded 427,520 in 2012, about a 0.7% drop from the 430,403 transactions registered in 2011.

The value of all property transactions had, however, increased by 3.6% to RM142.84bil in 2012, compared with RM137.83bil in 2011.

The volume of residential property transacted in 2012 was 272,669 with a value of RM67.76bil, compared with 269,789 with a value of RM61.8bil in 2011.

Raine & Horne Malaysia director Michael Geh said he expected property prices in Penang to rise by about 10% this year.

“There will be more property launches in the next six months, compared with a year ago. Developers in Penang are now getting ready to execute their project plans for this year.

“We expect to see large-scale launches in Batu Ferringhi in the north-east district and in Teluk Kumbar and Bayan Lepas in the south-west,” he said.

Geh said the tighter conditions on housing loans would weed out speculators, as many of them would find it more difficult to borrow, since they were already owning more than one properties.

“We expect less speculators this year and more genuine home buyers,” he added.

Geh said that although the demand for high-end condominiums had weakened slightly in Penang, their prices had not dropped.

“We can expect to see more high-end condominiums being rented out this year, plunging further the rental yield in Penang,” he said.

Source: StarProperty.my

BUKIT MERTAJAM: The long-awaited Penang Sentral project is likely to start in the fourth quarter of this year, says the Northern Corridor Implementation Authority (NCIA).

Its chief executive, Datuk Redza Rafiq said NCIA was looking at how to position the project, and work in line with the collaborative engagement model with all parties involved.

“We are now going through the land acquisition process with all the stakeholders. Rest assured that the project will start this year, most likely in the fourth quarter,” he added.

Redza said this in response to a question on the delayed project which has raised concerns among Penangites, with the ground breaking ceremony by former Prime Minister Tun Abdullah Ahmad Badawi, held in 2007.

He said the first phase of the project, which is the construction of the integrated transportation terminal, would take two years to complete, while the entire project is a 10-year initiative.

Penang Sentral, another highlight of the Northern Corridor Economic Region’s (NCER) undertakings, is a proposed integrated transport and logistics hub, which will integrate rail, ferry, monorail and land transport.

The integrated transport hub will be built on the site of the Butterworth ferry terminal, railway station and former bus terminal, covering an area of 557,418 square meters.

The proposed RM2 billion modern and comprehensive transport hub would be developed via a joint-venture between Malaysian Resources Corporation Bhd (MRCB) and Pelaburan Hartanah Bumiputra Bhd.
The proposed hub will consist of two ferry, two monorail, four train and 50 bus platforms as well as 4,000 parking bays, with commercial and residential properties.

It has the capacity to accommodate some 200,000 passengers/users daily. – Bernama

Source: TheEdge Property

GEORGE TOWN: The second Penang bridge is set for completion in July.

The longest bridge in South-East Asia and 20th in the world will then go through road commissioning and testing in August before being officially opened in September.

During a tour, the media was given a first-hand look at the 24km-long bridge with 16.9km spanning over water.

The second Penang bridge links Batu Kawan on the mainland to Batu Maung on the island and offers users a unique experience of its “curvy” design and aesthetics of the cable-suspended section of the bridge at the navigation span.

Travelling time on the bridge is estimated to take about 30 minutes at 80kph.

The bridge would also be decorated with LED lights to match various festive seasons similar to that of the Incheon Bridge in South Korea, said Jambatan Kedua Sdn Bhd Package One senior manager Azmi Mohamed yesterday.

He added that work had also started on road furnishing like the installation of parapet, street lighting, road signs and tarring.

He said the China Harbour Engineering Co Ltd (M) Sdn Bhd (CHEC) would be in charge of the 475m stretch of the main navigation span.

“The height clearance is 30m and width 240m for vessels to pass beneath at the main centre span.

“This bridge is also constructed with two car lanes and one motorcycle lane. This means that motorcyclists have to use the designated lane or risk being summoned,” he said.

He added that the opening of the RM4.41bil bridge in September would be two months ahead of schedule.

The second Penang Bridge is 10.5km longer than the first bridge and once open will provide easy access for commuters to the Batu Kawan stadium, Batu Kawan industrial park and the Plus highway.

On the island, commuters will have direct access to the Free Industrial Zone.

It was reported that the bridge is expected to reduce traffic congestion on the current Penang Bridge by 25% to 30% and could cater to around 100,000 vehicles per hour.

Source: StarProperty.my

Taking a home loan? Here are 5 common home loan mistakes that people make especially when they’re applying for it for the very first time. Read on so you can avoid these pitfalls too.

Diving in When You’re Not Qualified

Banks, by nature, are generally eager to offer home loans to qualified homebuyers. The keyword, though, is “Qualified”. In Malaysia, a qualified home loan applicant generally refers to one with the appropriate Debt Service Ratio (DSR) and has no red marks on the Central Credit Reference Information System (CCRIS) report collated by Bank Negara. If you don’t fit the criteria, they’ll have no problem rejecting your application. So before you apply you’ll want to make sure you’ve done the necessary preparations and are not fighting a lost cause right from the start.

Going Straight for the Lowest Interest Rate and Nothing Else

You’re going to borrow a big sum of money. Obviously, you’ll sign up with whoever that offers you the lowest interest rate. Right? To a certain extent, it is. Your priority should definitely lies with getting the lowest possible interest rate, but you shouldn’t forget about things like margin of financing, lock-in period, and simple stuffs like making sure a branch is within your vicinity.

For a list of things you should consider, check out these 6 things you should consider when taking up a home loan to buy a house in Malaysia.

Applying with Just One Bank and Telling Them So

In Malaysia, it has become a general practice for seasoned homebuyers to “shop around” for the best home loan deals before you commit.  Apply with only one bank, and what you’re really doing is giving yourselves no other options even if the terms offered to you are appallingly bad.

The even worse mistake you could be making is telling a loan officer that “they are the only bank you’re applying with”. It’s pretty much the same as giving them the licence to give you the worst possible rate, because they’d know you have no where else to turn to as the 2-or-3-week deadline you’re usually given by the housing developers runs down.

You may try this Home Loan Recommendation tool.

Not Factoring in Your Home Loan Costs

Home loan involves fees, charges and even home insurances that may come as a surprise for the inexperienced homebuyers. Some banks absorb part of these charges, whilst others may not. Most homebuyers have limited funds (and hence the need to take a loan), so it is imperative that you understand these charges involved before you commit.

To understand the major fees and charges associated with buying a property through a home loan, please refer to our article “Are You Financially Ready to Buy a House in Malaysia” written for The Star Property.

Not Reading the Terms & Conditions

At iMoney, we’ve always emphasized on the need to read all the fine prints for anything that involves money. This goes for your home loan agreement as well. If you don’t have the capacity to do so, make sure you get the loan officer to point out all the things that matter (such as loan amount, interest rate, installment amount, loan period, margin of finance, lock-in period, early settlement penalty and fees & charges).

The general rule: if it doesn’t appear in your agreement, it doesn’t take effect. Period. So if your home loan shows a lock-in period of 3 years whilst your officer is telling you it’s 1 year, the former wins. All the time.

Taking a home loan right now?  Why not check out our home loan comparison table and find one that suits you the most!

This article comes courtesy of www.imoney.my which compares between the various loans, savings and insurance schemes available in Malaysia.

I found my dream house. The developer’s office said the project was selling like hot cakes. Sales were on a first come first serve basis’ and I must pay a deposit otherwise she would have to give it to someone else. Or was it a booking fee she called it?

I begged her to give me one week. Three days, she said. How very sweet and understanding of her. Bank loan? No problem… 85% loan margin? No problem, she assured me. If I could not get a housing loan I could always cancel and get my money back. I left the developer’s office feeling on top of the world. I had secured my dream house by paying the deposit. My dream turned into a nightmare when I could not get a bank loan. I had no choice but to forgo the house.

As if letting go of my dream was not bad enough, the developer now refuses to give me back my deposit. The lady said her hands were tight because it’s a management decision. It was not stated in the option letter’ or booking form’ that my purchase was subject to the loan approval. On reading the terms and conditions in the option letter/booking form, I now realised that all terms were inclined in favour of the developer.

What do I do? I just want my money back. I don’t mind if they keep a small sum for cost of paper work and for administrative purposes.

The above scenario is not at all uncommon.

Many house buyers are unaware of lending guidelines requiring loans to be tagged to net income as opposed to gross income. Many find that they are unable to obtain the financing they want and have to withdraw from an intended purchase before the sale and purchase agreement is even signed. The developer then refuses to refund the deposit or booking fee or whatever other payment which may have already been paid.

The unfortunate part about this whole thing is that house buyers do not have the luxury of a learning curve in which they can acquire the necessary skills to avoid getting themselves into trouble. Very often by the time they realised that they have made a mistake, it is already too late and the result can be traumatic and financially crippling.

This very noble and seemingly simple undertaking of buying a house, in a lot of cases, have gone terribly wrong.

Can developers collect booking fee or deposit?

The sale and purchase agreement (Schedule G, H, I or J) as prescribed by the Housing Development (Control and Licensing) Regulations, 1989 (the Housing Regulations) provides very clearly how the purchase price is to be paid. The first 10% is payable immediately upon the signing of the sale and purchase agreement (SPA), not before.

No collection of any payment is allowed before the SPA is signed. Deposit, booking fee, advance payment, administration charges are just some of terms used by some devious developers in their vain attempts to circumvent or contract out of the Housing Regulations and to confuse, mislead and convince nave house buyers especially the first-timers.

Collection of any payment by a housing developer before the signing of the SPA is an offence. This is very clear under the Housing Regulations and it does not matter what the developer calls it.

The Housing Regulation 11(2) stated: “No housing developer shall collect any payment by whatever name called except as prescribed by the contract of sale”. (In this context’ contract of sale means the SPA)

Commission of such an offence under the Housing Regulations means that the developer in question can be prosecuted, fined and/or even imprisoned under Regulations 13. Even those persons who knowingly and willfully aids, abets, counsel, procures or commands the commission of such an offence shall be liable to be punished.

Prosecution, however, is in the hands of the public prosecutor whose action or non-action the house buyers are not able to dictate. House buyers and indeed the general public are of course at liberty to lodge a complaint against any developer in breach of any housing laws. Such complaints can be lodged with the Enforcement Division of the Ministry of Housing and Local Government: www.kpkt.gov.my

The law as regards non-payment before the signing of the SPA is very clear and house buyers are strongly urged to understand the law and not be misled by some cunning, unscrupulous developers or their smooth talking sales representatives who either do not know the law or simply do not care about the law.

Profit orientated developers care about nothing but profit. The more they sell the more they gain. They engage marketing commission agents and sales representatives whose only mission is to sell. In their quest to sell their products, some unprincipled commission agents (secondary markets included), who are untruthful will not hesitate to mislead, conveniently telling “white lies” and make empty promises to make a quick buck. Some are so well trained in the art of selling they can probably sell sand to the man in the desert.

Ever wondered why the sales office told you there are only five units left but three months later there are more than 10 units still available? Did the developer’s office tell you the unit you want is already booked but called you two days later to congratulate you because the same unit has just become available? Ever gone to a developer’s office in the hope of getting the “Early Bird Discount” advertised the day before only to find that the project was launched more than a year ago?

Filing a claim for refund

Free gifts, rebates, and waivers of this or that are also fairly commonly seen and are often stated to be for a limited time only. House buyers hurry to meet the deadline. Three months later the same advertisement appears, again for a limited time only or perhaps extended due to popular demand. Gimmicks of “Free legal fees” offer but you must use the developer’s panel lawyers are commonly marketed.

The list of marketing ploys used by developers and their marketing alliance goes on and unscrupulous developers and real estate agents are not likely to stop trying to exploit vulnerable house buyers any time soon. House buyers must therefore be very wary and not be easily swayed by promises made by the developer’s office.

House buyers who are already caught in tussles with housing developers over refund of booking fee or deposit are at liberty to file their claims at the Tribunal for Homebuyer Claims (the Housing Tribunal). The Housing Tribunal was set up as an alternative forum for house buyers to save them the costs and hassle of fighting with housing developers in the civil courts.

The filing fee is only RM10; no lawyers are required and hearings are normally fixed within a month. The Housing Tribunal is empowered to hear disputes between house buyers and licensed housing developers even though the SPA is yet to be signed but the claims must be filed within the time frames provided under section 16N of the Housing Development (Control & Licensing) Act 1966 (the HDA). Check out the link: www.kpkt.gov.my TTPR

Can the developer forfeit such payment?

Where booking fee or deposit or any other payment is collected by the developer before the SPA is signed, the house buyer would normally have been asked to sign a document indicating the house/apartment/condominium he/she is interested and agreeing to sign the SPA within a certain time frame, say 7 or 10 days or upon notice from the developer. This document may be in the form of an option letter, letter of offer, sales proforma, booking form or another document by whatever name the developer chooses to call it, all in an attempt to disguise a collection prohibited by law.

The amount varies and in some cases it is as much as 2% of the purchase price RM10,000 for a RM500,000 house. When the house buyer decides to withdraw from the intended purchase, the developer refuses to refund the deposit, or was it booking fee, or was it …?

by Chang Kim Loong

Source: StarProperty.my

Chang Kim Loong is the honorary secretary-general of the National House Buyers Association: www.hba.org.my, a non-profit, non-governmental organisation manned by volunteers. He is also a NGO councillor at the Subang Jaya Municipality Council.