65% of houses launched in H1 cost RM500,000 and below
Rehda survey shows an increase from 52% in the second half last year
PETALING JAYA: The proportion of residential properties launched in the price range of RM500,000 and below experienced a jump to 65% of total launches in the first half of this year compared with 52% in the second half of 2017, according to a Real Estate and Housing Developers’ Association Malaysia (Rehda) survey.
President Datuk Soam Heng Choon said Rehda Property Industry Survey for the first half, which saw the participation of 152 Rehda members from across the peninsula, also found there was a 12% contraction in the overall number of residential units launched during the period under review.
Nonetheless, sales performance grew by 6%, with 6,764 units being recorded sold, he said during the media briefing on the survey’s results here yesterday.
Two- and three-storey terrace houses took the lead with 2,858 units sold, mostly located in Sepang and Shah Alam, followed by apartments/condominiums (2,047 units) located mostly in Cheras and Segambut.
The survey found that for most states, the most launched selling prices were in the range of RM100,001-RM500,000 with the exception of Kuala Lumpur and Selangor (RM500,001-RM700,000). Soam said the percentage of respondents reported to have affordable housing components in their development increased to 47% compared with 41% in the second half of 2017 and 37% in the first half of 2017.
“Top three suggestions from the respondents to encourage provision of affordable housing were reduction of development charges, lower land conversion premium and exemption of capital contribution,” he said.
However, the percentage of respondents with unsold units increased to 75% from 66% in the second half of 2017, the majority of which having up to 30% unsold stock.
Most of the unsold units appeared to be equally distributed within the price ranges of RM250,001RM500,000 (mostly for Kuantan and Alor Star areas), RM500,001RM700,000 (mostly Johor Baru and Shah Alam) and RM700,001-RM1mil (mostly Johor Baru and Puchong).
“End-financing and unreleased bumiputra units remained the two major issues for unsold units. Respondents facing end-financing problems increased to 89% in the first half of 2018 and 39% of the loan rejections were for properties priced RM500,000 and below.
“Contributing factors to the financing issue include lower margin of financing offered, ineligibility due to buyers’ income and adverse credit history,” he added.
On the outlook, Soam said nearly half of the respondents planned to launch in the second half of this year, and the 15,852 units to be launched would comprise 8,991 strata units, 6,433 landed units and 428 commercial units.
However, he said, two-thirds of the respondents expected their sales performance to be 50% and below.
“The majority of the respondents were neutral towards the economic and business outlook and the property industry outlook this year. However, respondents are optimistic of the market in 2019,” he added. — Bernama KUALA LUMPUR: Housing and Local Government Minister Zuraida Kamaruddin said the National Housing Policy is awaiting Cabinet approval and it be made public before or after Nov 2 when the Pakatan Harapan government unveils its first budget. She was speaking at the Finance Ministry initiative, Malaysia: A New Dawn investors’ conference, on Tuesday.
Although a National Housing Policy was drawn up under Tan Sri Chor Chee Heung, the Housing Minister between 2010 and 2013, that document emphasized the need for a proper policy that went beyond identifying challenges in the sector.
In a previous interview with National Housing Department director-general N. Jayaselan, he said the drawing up of the new policy involves massive work but “we have got to start somewhere.” In that July 2018 interview, Jayaselan said the government has been working on it for 18 months.
This policy is expected to encompass issues related to the rental market and legislation, size, design and quality of construction of social and affordable housing and public-private partnerships and the establishment of an affordable housing council.
Zuraida said her next focus would be unsold properties, which according to the National Property Information Centre was valued at some RM22bil as at the first quarter of 2018. The government has been liaising with Bank Negara Malaysia and commercial banks to tweak lending.
“Once the financing has been sorted out, we would then be able to leverage on this more flexible financing structure to resolve the issue of unsold units,” Zuraida said.
Getting a buy-in from banks was needed to help the B40 group and to resolve unsold housing stock. “There were proposals to organise a home-ownership campaign covering the unsold stock, but we would like to focus on the affordable segment in this campaign, which may be held in January or February 2019. My immediate focus is the national policy,” she said.
Zuraida said the proposed campaign would take after the monthlong one initiated by then-prime minister Tun Dr Mahathir Mohamad and Tun Daim Zainuddin in December 1998, also to sell unsold stock. About 22,000 units valued at RM5.2bil were put on sale then.
Zuraida also advised developers to accept a hair-cut for their unsold stocks.
“So is it a hair-cut 1, 2 or 3? The lower the better,” she said, adding that the unsold stock of properties have to be cleared.
A property analyst with a local bank said prices should be based on market forces and developers are already giving considerable discounts on unsold units.
“Some are selling at cost. If developers were to take a haircut, this would upset those who have bought the units,” she said.