Property sales to see steady growth of 10% for 2013

KUALA LUMPUR: The Malaysian Institute of Estate Agents (MIEA) said it sees a steady sales growth of 10% across all sectors of the property market over the rest of the year, leading into early 2014. 

MIEA president Siva Shanker told the media at a property seminar yesterday he believes the property market will continue to do well, even though it is playing catch-up to the first half of the year, which saw a lot of launch delays and investor uncertainty before the general election in May. 

“The growth number we think we’ll see this year won’t be the same as the 20% to 30% we’ve seen over the last couple of years, but rather a steady, more moderate growth. 

“We don’t like seeing growth happening too fast because it could lead to a decline if the market cannot keep up,” he said, emphasising that there is no possibility of a property bubble. 

Siva said economic conditions in Europe, the US and China are also contributing factors to the slight slowdown in Malaysia’s property market during the first half. 

Commenting on the trends in the Klang Valley property market post election, he said 75% of the transactions seen in the first quarter occurred within the residential sector.

“Purchases of terraced houses and condominiums have been the primary driver for the first quarter, with total purchases in the residential sector amounting to RM7.6 billion so far,” he said. 

Siva expects the total value of transactions for 2013 to match 2012’s figure of RM37.5 billion. 

As for high-end condos, he said low occupancy rates do not necessarily reflect the take-up rate after a development is launched. 

“A lot of condominiums are not actually empty, there is a process to filling it up. When a new block gets finished, people will take time to move in, do renovations, or wait for tenants,” he said. 

The capital values of high-end condominiums have been climbing upwards since 2010, ranging from steep climbs in the KLCC/KL city area to more gradual climbs in other areas. 

In terms of Klang Valley land prices, MIEA deputy president Erick Kho said within prime locations, land prices range from RM2,000 per sq ft (psf) to RM2,500 psf and are expected to go up further. 

“In our view, land in the CBD [central business district] is still cheap considering its development potential,” said Kho. 

He said with selling prices in city fringe projects going up to RM1,000 psf, investors are shifting interest back to the KLCC area.

“Mega government and transport projects, like the MRT Blue Line, are expected to support land prices in the Kuala Lumpur CBD,” he said. 

He added that several hot spots to watch out for in the Greater Kuala Lumpur region would be Sungai Buloh, Cheras and a development triangle consisting of KL CBD, Klang and the Kuala Lumpur International Airport. 


This article first appeared in The Edge Financial Daily, on July 25, 2013.

Property sales to see steady growth of 10% for 2013

KUALA LUMPUR: The Malaysian Institute of Estate Agents (MIEA) said it sees a steady sales growth of 10% across all sectors of the property market over the rest of the year, leading into early 2014. 

MIEA president Siva Shanker told the media at a property seminar yesterday he believes the property market will continue to do well, even though it is playing catch-up to the first half of the year, which saw a lot of launch delays and investor uncertainty before the general election in May. 

“The growth number we think we’ll see this year won’t be the same as the 20% to 30% we’ve seen over the last couple of years, but rather a steady, more moderate growth. 

“We don’t like seeing growth happening too fast because it could lead to a decline if the market cannot keep up,” he said, emphasising that there is no possibility of a property bubble. 

Siva said economic conditions in Europe, the US and China are also contributing factors to the slight slowdown in Malaysia’s property market during the first half. 

Commenting on the trends in the Klang Valley property market post election, he said 75% of the transactions seen in the first quarter occurred within the residential sector.

“Purchases of terraced houses and condominiums have been the primary driver for the first quarter, with total purchases in the residential sector amounting to RM7.6 billion so far,” he said. 

Siva expects the total value of transactions for 2013 to match 2012’s figure of RM37.5 billion. 

As for high-end condos, he said low occupancy rates do not necessarily reflect the take-up rate after a development is launched. 

“A lot of condominiums are not actually empty, there is a process to filling it up. When a new block gets finished, people will take time to move in, do renovations, or wait for tenants,” he said. 

The capital values of high-end condominiums have been climbing upwards since 2010, ranging from steep climbs in the KLCC/KL city area to more gradual climbs in other areas. 

In terms of Klang Valley land prices, MIEA deputy president Erick Kho said within prime locations, land prices range from RM2,000 per sq ft (psf) to RM2,500 psf and are expected to go up further. 

“In our view, land in the CBD [central business district] is still cheap considering its development potential,” said Kho. 

He said with selling prices in city fringe projects going up to RM1,000 psf, investors are shifting interest back to the KLCC area.

“Mega government and transport projects, like the MRT Blue Line, are expected to support land prices in the Kuala Lumpur CBD,” he said. 

He added that several hot spots to watch out for in the Greater Kuala Lumpur region would be Sungai Buloh, Cheras and a development triangle consisting of KL CBD, Klang and the Kuala Lumpur International Airport. 


This article first appeared in The Edge Financial Daily, on July 25, 2013.

Should you invest in retail property?

PROPERTY investment has always been known to be a great and traditionally “safer” way to generate attractive returns.

Residential property aside, the commercial or retail sub-sector is also known to provide sound investment returns.

“For those looking to diversify their investments with steady yields and capital growth, retail property is a good option,” says an industry observer.

Factors to consider

As expected, location is crucial when it comes to property investment.

“There is an oversupply of shoplots today but there is also demand for it,” says Malaysian Association for Shopping and Highrise Complex Management’s past president Richard Chan.

“However, its success very much depends on where it’s located and what it’s selling,” he tells StarBizWeek.

Chan says accessibility and the property’s surrounding location are important.

“Today, location is not the only criteria. If a shopping complex is hard to access, it will be empty. Parking space is also important. Furthermore, if the surrounding location is well established, it would also do better.”

In terms of rental trends, Carey Real Estate Sdn Bhd managing director Nixon Paul notes that mini markets, fast-food outlets and banks tend to seek units in well-established areas with high pedestrian traffic.

“Corner units are always sought after irrespective of location, with mamak restaurants being the number one contenders.”

Nixon says food and beverage outlets tend to seek shops with reasonable car parking space available.

“The higher-end outlets tend to provide valet parking services to overcome this problem.”

He adds that landlords tend to shy away from snooker parlours, Internet cafes and massage parlours.

“Rental is only offered to these businesses when landlords have been unable to secure alternative tenants for long periods of time.”

Nixon says Sungai Wang Plaza and Times Square are two sought-after complexes.

“While many other shopping complexes have failed when spaces were sold to the public, these two complexes have succeeded extremely well. Prices in these complexes range from RM 3,000 to RM 20,000 per sq ft.

“The general perception among investors is that these complexes are in prime locations with a huge tourist population and as such tenants will always be readily available. Investors are also of the opinion that property prices in these complexes will appreciate in the longer term due to the strong rental demand.”

Benefits of retail property investment

One industry observer notes that retail property can provide long-term capital investment.

“Retailers usually want to do business for the long term and generally sign long leases. This provides stability to the investor.”

Nixon notes that there is a growing preference among investors to invest in commercial or retail property.

“When it comes to commercial property, there are less maintenance issues to contend with.”

He says when it comes to issues of financing, commercial properties currently have it easier with fewer restrictions in comparison to residential properties.

“Those who do qualify can secure small and medium-sized enterprise (SME) loans that can be used for working capital.”

Nixon also notes that as of late, residential bungalows fronting busy roads in Kuala Lumpur and Petaling Jaya have been given licences to operate under limited commercial purposes.

“Usage is limited to showroom and office use only. Advantages of bungalows over shops or retail spaces in complexes is that you get larger spaces for less money, better advertising exposure and private parking.”

Know what you’re getting into

While investing in retail property has its benefits, it does come with risks.

“The success of a business in a mall or shoplot is very much determined by the health of the economy,” says an analyst.

“For those looking for short-term gains, you can forget it! Think annual returns of between 3% and 4%. It’s a long-term thing,” says Chan.

Nixon says a growing concern among investors is that rental values are not increasing in tandem with the appreciation of selling prices.

“Valuation of shops often cannot meet asking prices and rental of the upper floors of shops are always a concern.

“Furthermore, older shops without lifts are generally not sought after by tenants and newer developments tend to take between three to five years before commercial activity and occupancy reaches optimum levels.”

He adds that investments in commercial property are generally more expensive in comparison with residential property and usually attracts the more savvy investors.

“Of late, many smaller and newer investors are also investing in these properties by pooling their resources and making collective purchases. Developers should consider building shophouses rather than shop-offices.

“Shophouses give investors an opportunity to buy a single property, stay in it and also generate rental income on the ground floors and lower floors. The floor that is designated for residential use needs to be fitted out with quality fittings and finishes and with car parking facilities.” - The Star

Penang Real Estate | Penang Property | Penang Properties: Jambul View & Jambul Court Wanted Urgently

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Minden Height Bungalow Lot / Bungalow Wanted Urgently

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Penang Real Estate | Penang Property | Penang Properties: Batu Maung Terrace House For Sale / For Rent

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Affordable ways of housing our nation

Last month, readers of this column were “brought around the world” to discover some exemplary public and affordable housing policies implemented in other countries. There are some interesting ideas that were derived from this exploration, which can be enlightening towards building affordable homes for our nation.

Hong Kong, Singapore, London and Australia have their own success stories with regard to building affordable homes. What they share in common is strong enforcement of policies with stringent rules.

Applicants applying for public housing in Hong Kong are required to undergo comprehensive credit tests covering the applicant’s income and assets.

In Singapore, the Housing and Develop­ment Board (HDB) flat owners-to-be are not allowed to own other properties in Singapore or in other parts of the world.

In London, applicants who wish to purchase a council house must own it as their only home and use it for owner occupation.

The Australian government came up with innovative ideas to increase the supply of affordable homes by offering financial incentives to individuals or entities to build and rent houses at 20% lower rental rate to moderate and low income earners.

It is statistically proven that these countries have reaped the benefits of their own respective methods. The question that now begs an answer is: What policies or housing models should we adopt to successfully house our own nation?

To deal with housing issues that involve population growth, income and development levels, there is no one model that fits all. What we can do is to learn from successful models and customise them to meet our requirements. It would even be better if we could successfully come up with our own model.

Earlier this year, our government set a goal to deliver one million affordable and low-cost homes to the public within the next five years. This is equivalent to an average of 200,000 homes annually. An institution, 1Malaysia People’s Housing (PR1MA) was set up primarily to build affordable homes and has been reported to have targeted 80,000 homes in the first year with slightly over 100,000 in the subsequent years.

The vision to build affordable and low-cost homes is applauded. Yet, questions of how it is to be achieved remain real. For instance, where should these houses be built? How to make these houses affordable to the rakyat? What regulations need to be put in place to ensure affordable housing is only owned by deserving families?

Universally, public housing is subsidised by the government due to cost and resource considerations. Land, for example, is the most crucial element in any housing development. Scarcity of land leads to costly land prices, especially in the city. The price of materials to build homes has increased over the years.

Therefore, without some form of government incentive or subsidy, it is virtually impossible for private developers to sell affordable, let alone low-cost homes.

The government can materialise its vision by providing aid in other forms. Since a lot of land resources are owned by the government, it can offer subsidies or incentives to private developers to use the land for public housing development.

Certain land belonging to government agencies, such as theRubber Research Institute (RRI), are very large and strategically located and are among the potential areas that the government can consider releasing to build affordable homes.

Another good policy would be to encourage the development of new townships in outlying areas rather than focusing on already developed and highly populated areas. Not only are these lands considerably cheaper, it would also alleviate the burden of over-crowded cities.

The government can build transportation infrastructure, including fast commuter rail and MRT along with other amenities such as schools and commercial hubs, to allow these new townships to prosper.

Besides looking at ways to build more affordable homes, addressing the delivery of the homes is equally important. PR1MA targets to deliver homes with prices ranging from RM100,000 to RM400,000 to the middle class with an average monthly household income of RM2,500 to RM7,500.

According to the information published on its website, PR1MA homes must be owner occupied, and a 10-year moratorium will be imposed, in which the property cannot be sold or transferred to another party without prior approval.

Additional consideration should include devising a comprehensive mechanism to determine qualified applicants and whether to impose any restriction on owning other property before applying for a PR1MA house.

The recommendations shared thus far are among the ideal policies and guidelines the government should consider seriously if it is to achieve its vision of housing the nation. The next critical success factor is to ensure the policies and guidelines are strongly enforced without any leakage that may sabotage the vision and leave deserving families in the lurch.

FIABCI Asia-Pacific Regional Secretariat chairman DatukAlan Tong has over 50 years of experience in property development. He is also the group chairman of Bukit Kiara Properties.

For feedback, email feedback@fiabci-asiapacific.com - The Star

Penang Real Estate | Penang Property | Penang Properties: Projects by IJM in Penang

Listed on the Main Board of Bursa Malaysia, IJM’s Property Division is one of the largest property developers in Malaysia with a strong presence in key market centres throughout the country. A trusted developer with an impressive portfolio of projects, IJM Land Berhadalso boasts one of the largest land banks in the country. Beyond the shores of Malaysia, we are highly regarded as an exceptional property developer in many countries including Singapore, China and India.

This success can be attributed to the fact that IJM Land takes great pride in the longevity of our developments. More than just building houses and retail outlets, we are committed to creating sustainable lifestyles and communities for future generations.

IJM Land’s properties are always in demand as they offer consumers a great range of living options to choose from, exceptional value and a return-on-investment that exceeds all expectations. Our wide variety of offerings includes residential and commercial developments, integrated townships and investment properties.

There are a numberous projects which have been developed by IJM in Penang Island and they are among one of the most sought after properties in Penang. 

Below are some of the IJM residential projects in Penang and please click on it if you are looking for more information about these projects:-

1. Alpine Tower
2. Lakeside Towers
3. Nautilus Bay
4. Parkview Towers
5. Platino
6. Sierra Vista
7. Sri Pangkor
8. Sri York
9. Summer Place
10. The Collection I
11. The Collection II
12. The Light Linear
13. The Light Point
14. The Spring

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Penang Real Estate | Penang Property | Penang Properties: Projects by IJM in Penang

Penang Real Estate | Penang Property | Penang Properties: Pulau Penang Apartment For Sale / For Rent / To Buy

Penang Real Estate | Penang Property | Penang Properties: Pulau Penang Apartment For Sale / For Rent / To Buy:

Pulau Penang Apartment For Sale / For Rent / To Buy
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Penang Real Estate | Penang Property | Penang Properties: Mutiara Height Condominium Wanted

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Penang Real Estate | Penang Property | Penang Properties: Projects By E & O in Penang

THE E&O GROUP - A LEGACY OF EXCELLENCE

Via its core divisions of property development, property investment and hospitality & lifestyle, the E&O Group has extensive interests in Kuala Lumpur and Penang.Today, the Group's portfolio ranges from modern city condominiums in the heart of Kuala Lumpur to the signature restaurants of the Delicious Group, from prime residential neighbourhoods in the city's premier suburbs, to the sprawling 1,000-acre seafront community of Seri Tanjung Pinang in Penang.

Yet, what sets the Group apart from all others is the inimitable spirit of grace and refinement drawn from the rich heritage of the legendary 19th century E&O Hotel in Penang from which the Group takes its name and its inspiration. Along with its sister Lone Pine Hotel in Batu Ferringhi, each endeavour that bears the distinguished E&O name continues to set the standard for iconic style and timeless elegance.

The project which is developed by E &O in Penang Island is called Seri Tanjung Pinang and they are among one of the most sought after properties in Penang. 

Below are the name of each of E & O project in Seri Tanjung Pinang and please click on it if you are looking for more information about these projects:-

1. Seri Tanjung Pinang - Courtyard Homes
2. Seri Tanjung Pinang - Quayside Seafront Resort Condominium
3. Seri Tanjung Pinang - Semi Detached Homes
4. Seri Tanjung Pinang - Suites at Straits Quay
5. Seri Tanjung Pinang - Villa By The Sea

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Penang Real Estate | Penang Property | Penang Properties: Projects By E & O in Penang

Penang Real Estate | Penang Property | Penang Properties: Projects by Sunway in Penang

Sunway Berhad is one of the largest Malaysian-based property-construction conglomerates with a strong regional presence. It was listed on the main market of Bursa Malaysia Securities Berhad in August following a merger between two of Sunway Group’s public-listed companies, Sunway Holdings Berhad and Sunway City Berhad.

There are a numberous projects which have been developed by Sunway in Penang Island and they are among one of the most sought after properties in Penang. 

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1. Sunway Aspera
2. Sunway Bukit Gambier
3. Sunway Cassia
4. Sunway Merica
5. Sunway Mutiara
6. Sunway Prima
7. Sunway Tunas
8. Sunway Tunas Jaya

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Penang Real Estate | Penang Property | Penang Properties: Projects by Sunway in Penang

Penang Real Estate | Penang Property | Penang Properties: Pulau Penang Property / Properties For Sale / For Rent

Pulau Penang Property / Properties For Sale / For Rent

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Penang Real Estate | Penang Property | Penang Properties: Pulau Penang Property / Properties For Sale / For Rent

Penang Real Estate | Penang Property | Penang Properties: Meridien Residence Wanted

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Penang Real Estate | Penang Property | Penang Properties: Meridien Residence Wanted

Penang Real Estate | Penang Property | Penang Properties: Quayside Block D / E Wanted

Attention: All owners of Quayside Seafront Condominium, Tanjung Tokong, Penang,

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Penang Real Estate | Penang Property | Penang Properties: Quayside Block D / E Wanted

Penang Real Estate | Penang Property | Penang Properties: Villa Kejora Condominium Wanted

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槟胡椒园木砖屋相续拆 住户盼续守家园

（槟城8日讯）新地主停止收租，木砖屋一间接一间拆除，槟城胡椒园200多家住户诉求继续守望家园或一屋赔一屋。
一批临时成立的水池路胡椒园住户捍卫委员会成员，周一下午告诉传媒及植物园区州议员谢嘉平律师，过去一周里，胡椒园里已有4所木砖屋相继拆除。
胡椒园住户捍卫委员会主席安妮说，据他们所了解，新地主将在10天之内，先拆除该区7所木屋，并计划在不久将来，将胡椒园变成一座高级住宅区。
她说，今年初开始，新地主已停止向胡椒园内的200多家住户收取租金。而在之前，胡椒园旧地主每月收取每家住户40令吉租金。
安妮说，胡椒园这个被山林围抱，占地11万9876依格的槟岛水池路住宅区，建于上世纪60年代间，拥有307间木砖屋，其中200多家都有人住。住户都是中下阶层劳动者。
她说，胡椒园住户捍卫委员会最近做了一项问卷调查，80%以上的住户都希望继续住在胡椒园这座他们生于斯长于斯的槟岛绿色家园。- 光华

纳兹里：大马第二家园计划 建议检讨需存30万条件

(怡保7日讯)旅游与文化部长拿督斯里纳兹里表示，将向内阁建议检讨大马第二家园计划参与者需存放30万令吉款项于大马之条件。

他说，该计划已实行11年，有必要作出检讨，目前来说，该计划要求的30万令吉过于低。

他指出，当初实行上述计划的目的是要吸引游客；唯他认为，若喜欢大马且要到来大马生活的外国人，应给予额外费用(premium)，有关费用亦不应只是30万令吉而已。

他说，已指示其部门官员，针对上述事项草拟提呈内阁的文件。他补充，提高参与该计划的款项，可让国家选择更有素质的人到来大马，亦可阻止外国人通过此计划轻易到来大马，与国人共享国家。

他周日在华都牙也，为凯利古堡设施提升仪式主持开幕后，在记者会上，发表谈话。

他披露，提升凯利古堡设施的工程耗资500万令吉，该工程在2011年9月28日动工，并于2013年4月10日完成。提升的设施包括大门建筑、训练中心、小型放映室、广场灯光、店铺、公共厕所及孩童游乐设施等。- 光华

Penang Real Estate | Penang Property | Penang Properties: Price Down - Prestige V (2T12)

Big House Small Budget

Price down for a brand new 2 storey terrace in Prestige V, Batu Maung.

Land area: 22 x 70 feet

Price dropped from RM950K to RM928K

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Penang Real Estate | Penang Property | Penang Properties: Price Down - Prestige V (2T12)

Is curbing DIBS a solution?

Much focus has been placed on curbing the rising prices of properties but will it be a
cause for concern when it comes to the country’s economic growth? Given the slower-than-expected growth in the country’s economy in the first quarter of 2013, some concerns were raised should the measures become a drag to economic performance, especially when the global economy is shaky and the country’s economy is driven by domestic demand.

Malaysia’s gross domestic product (GDP) growth in the first quarter was lower at 4.1% compared with 5.1% in the corresponding period last year. The pace of growth was the lowest since the third quarter of 2009.

AmBank Group chief economist Anthony Dass tellsStarBizWeek that measures to curb property prices from accelerating significantly may have some impact on domestic demand and economic growth, but they will not be significant to impact the overall economic growth.

He says stronger property prices in the short term could strengthen investment and consumption
spending, giving a positive impact on domestic demand.

“However, in the long term the impact of property prices becomes neutral on domestic demand and
economic growth.

“Our view is that focusing on the property market as a policy tool should be more for short-term macro-economic management.

“Over-stimulating the property market may not effectively contribute to economic growth,” he
explains.

RAM Holdings Bhd group chief economist Dr Yeah Kim Lengsays that the potential curbs on the
Developer Interest-Bearing Scheme (DIBS) will only moderate property sales.

“Sales include a large proportion of purchases for investment purposes, they will not dampen
private consumption significantly,” he notes.

Housing and utilities, on average account for only 22% of household spending according to the
2009/2010 Household Expenditure Survey by the Statistics Department.

Some industry observers say that some sort of measures by the central bank to cool property prices and contain the rise in the household debt that currently stands at 80.2% of GDP are most welcome.

Yeah says: “Although the overall statistics show that household assets are still a multiple of household debt, we should still remain vigilant and not allow excessive growth especially if it is fuelled by imprudent lending or driven by sub-prime loans to vulnerable segments of the population.”

He opines that the house price increases over the past several years continue to exceed the average income growth particularly for the lower and middle-income groups.

“Such prudential measures to curtail speculative buying are welcome to prevent unsustainable and unjustifiable increases in property prices as well as to ensure that the overvalued property market does not wreak havoc on the economy should there be a sharp correction,” he adds.

Industry observers suggest that the hike in the property prices have been mainly driven by the market fundamental of supply and demand as well as other related costs such as building materials and land prices.


A win-win solution?

Dass says the country’s economy growth is mainly driven by investment, hence some measures to
curb property prices will not cause some downside risks to the economy.

He says the potential move to curb DIBS could help to reduce speculative activities in the property market so that prices are reflective of market forces.

“There would be some correction in property prices, however the impact could be temporary.

“This is good, at least it helps to re-balance the focus in the economy rather than being over-dependent on a sector and it helps to curb an asset bubble,” he says.

According to Kenanga Research, the DIBS does not affect banking liquidity, hence the impact would only be a knee-jerk reaction.

It says the impact of a loan-to-value (LTV) ratio of 70% on individuals with more than two housing loans and the change in mortgage assessments from gross to net pay have resulted in cooling property demand.

It says that measures such as the incremental real property gains tax (RPGT) hikes seen over the past two years had resulted in temporary correction before rebounding.

It was recently reported that the central bank had highlighted in its 2012 Financial Stability and Payment Systems Reportthat ever since the imposition of the LTV, the annual growth in lending to such individuals had declined sharply to 14.5% y-o-y in November 2010 to 1.9%
y-o-y in December 2012.

On the proposed property tax on foreign buyers in Johor,Kenanga Research points out that higher property taxes on foreigners would not dampen demand, as Johor properties are much cheaper than those in Singapore.

“We believe the measure is good for the long-term sustainability in demand as the influx of foreign buyers could cause sharp spikes in asset inflation, especially when foreign buyers from Singapore have an advantage on foreign exchange, which could lead to a property bubble,”
it says.

Kenanga Research, in a report, says that there is a concern that more fiscal tightening measures on the property sector such as higher RPGT could surface in Budget 2014.

Real Estate and Housing Developers Association (Rehda)president Datuk Seri Michael Yam
tells StarBizWeek that property prices have always been driven by market forces.

He says that there is inadequate supply of residential properties especially in the Klang Valley and Penang. He adds that there are five factors influencing property prices namely building materials, land prices, labour, compliance and interest costs.

CIMB Research, in a report, says supply growth in residential properties in Malaysia in 2012 was only 1.6% – the lowest in 10 years.

“We believe the cause of strong price increases in recent years is mainly due to supply constraints as opposed to excessive demand.

“In fact, any move by the authorities to curb speculation may have the unintended effect of slowing down supply growth, which would in turn exacerbate price increases over the longer term,” the research house says.

Alliance Research analyst Cheah King Yoong expects the move to impose curbs on the DIBS to only
impact the industry loan growth in 2014.

“We believe that the ongoing speculation of the DIBS removal could accelerate property transactions in the near term, which could temporarily drive the demand for mortgage loans,” he says in a report. - The Star