Penang home market subdued in 2017
> Transaction volume for residential units fell 8.1%, while the overall property market transactions fell 9.6%
PETALING JAYA: The Penang residential property market remained subdued last year, in line with the overall property market in the state, the Property Market Report 2017 revealed.
According to the report, overall property market softened further last year with a 9.6% drop in transactions to 16,592 units from 18,352 units the year before, although values rose 8.6% to RM10.39 billion from RM9.56 billion the year before.
The residential subsector, which made up 72.9% of the state’s property transaction volume, saw another decline in volume of transactions, marking three consecutive years of falling volume.
Volume of transactions fell 8.7% to 12,090 units, from 13,244 units. Value of transactions however bucked the trend of previous years, growing marginally by 0.9% to RM5.41 billion.
The number of new residential launches fell 31.3% last year to 3,879 units from 5,646 units in 2016, with 65% of new launches being condominiums and apartments. Sales performance was promising last year at 39%.
Despite the slowdown in new launches, the residential overhang worsened with 3,916 units worth RM3.82 billion. The increase was more than double, both in terms of volume and value, from 1,896 units worth RM1.47 billion in 2016.
Most of these units were condominiums and apartments priced more than RM500,000 per unit.
The unsold under construction units also grew, by 13.9% to 9,249 units from 8,119 units in 2016 while the unsold not constructed units decreased significantly by 97.3% to 80 units last year from 2,918 units in 2016.
Construction activity moderated last year as completions and starts shrank by 19.7% and 33.5% to 11,593 units and 10,681 units respectively, from 14,430 units and 16,060 units respectively in 2016.
However, new planned supply increased by more than two-fold to 12,864 units from 3,618 units in 2016. At end-2017, there were 497,396 existing residential units with another 44,046 units in incoming supply and 24,597 units in planned supply.
Prices of residential properties showed mixed movement across the state. In Seberang Perai Tengah, single storey terraced homes located nearby Aeon Mall and Tesco Hypermarket saw price increases while double storey terraced homes close to industrial areas recorded price gain.
Similar price uptrend was recorded in housing schemes located within new townships due to higher demand.
In the stratified segment, twobedroom flats in Taman Sri Aman recorded notable price increase due to its strategic location nearby The Golden Development Triangle area while threebedroom flats located adjacent to higher learning institutions such as Politeknik Seberang Perai enjoyed double-digit price increase.
As at Q4 2017, the All House Price Index for the state stood at 191.4 points, up by 4.6% from 182.9 points a year ago. The average All House Price for the state stood at RM429,234 during the quarter, compared with RM410,058 the year before.
The rental market was stable across the board, with positive rental growth in selected locations. In Seberang Perai Utara, double- storey terraced homes in schemes adjacent to Pusat Perniagaan Raja Uda saw rental increases of 3.1% to 14.2%.
For 2018, Penang’s property market is expected to be promising, supported by ongoing and upcoming projects, with infrastructure for transportation continuing to be one of the key development agenda for the island.
The newly operating Penang Sentral will be a new landmark for Seberang Perai. Upon completion, the transportation hub will also be a commercial trading centre comprising Rural Trade Centre, hotel, shopping centre and shops.
On the construction front, several notable developments include Seri Tanjung Pinang Phase 2, Sunway Valley City and Penang International Commercial City.
The Penang state government is also committed towards building 27,230 affordable homes in 17 projects throughout the state. This will be implemented via Penang Development Corporation.