Articles from the Star newspaper 26 january 2009
Experts have said that the Malaysian property market is resilient enough to withstand the onslaught of a softening global economy.They opine that sales would be ongoing but in small volumes as most purchasers adopt a wait and see attitude while developers downsize their new property launches.
Association of Valuers & Property Consultants in Private Malaysia (PEPS) president James Wong Kwong Onn says that property prices would fall 5% to 10% as slower economy cools demand.
“Prices for properties across the board will fall but on a gradual basis,” he says.adding that Malaysia is in a better position compared to Singapore, Hongkong and Thailand which are more exposed to the US subprime crisis.
He says the government’s RM7bil stimulus package including the reduction of Employee’s Provident Fund contriburitons from 11% to 8% coupled with lower interest rate and inflkation would provide the bright spark to the property market.
Real Estate and Housing Developers Association(Rehda) Penang branch chairman Datuk Jerry Chan Fook Sing thinks the property outlook in Penang is still bullish.
“Property prices in the state have always done well and with the level of economy we are going to be seeing,land prices both on the island and mainland should continue appreaciating buy at least 5% to 10% over the next five to seven years.”
Penang also has the highest sales growth in the countryh(five year compounded annual grothw rate (CAGR) of 11% vs the average of 8%).House prices on the island have risen to almost match the Klang Valley’s,growing at a five-year CAGR of 4.3% vs the national average of 2.9%.
The completion of the Penang bridge would also act as a catalyst for major growth.Economic activity in the vicinity would automatically intensify.
Chan foresees more people moving to the mainland especially to the southern part of Seberang Prai of which Batu Kawan is the first point of the second link between the island and mainland.
“When the first bridge was built,it was a nucleus for growth.Industrial areas mushroomed up overnight in the northern part of Seberang Prai.And areas like Butterworth,Juru and Bukit Minyak started growing and land prices appreciated.”he says
Land prices in the southern part of the mainland now range between RM8 and RM20 psf.He predicts that prices could easily appreaciate by 50% with the kind of major development projects happening over the next few years.
Penang’s property market has always drawn buyers from far and wide as the state has all the allure of a good place to live- the beaches,the hill and the people.The lack of land bank will continue to push demand for landed properties to go up while good condominium projects in selected locations will still do well despite the economic downturn.
Land shortage has shifted the focus of housing development to the south-West district comprising Relau,Teluk Kumbar,Batu Maung and Balik Pulau-the new growth corridor for Penang.
The housing trend at the moment places emphasis on life style concepts favouring luxurious developments with a resort feel while most new projects are gated and guarded.
Developers today are required to provide more such as quality finishing,extended warrantyh and better security.These featured are what purchasesrs look for when deliberating on their dream homes.