Malaysia’s property market will have a good result this year, as the economic situation improves and prices become more affordable.
A recent report from CIMB Research showed that due to moderate price appreciation, low interest rates and rising incomes, Malaysia’s residential properties are getting more affordable.
It said that this year, developers such as E&O Property Development Bhd (E&O Prop) will focus more on the maiden condominium venture located at Seri Tanjung Pinang in Penang.
“The RM1.8bil project will kick off with the official launch of the first block this month, which includes an aggressive awareness campaign,” it said.
E&O Property will also work towards the opening of its new condo units in Kuala Lumpur as its previous project, St Mary Residence, had already reached a milestone, with a combined 60 percent take-up rate for the two blocks.
“For SP Setia Bhd, the group is targeting to sell a minimum RM1.6bil worth of properties in FY09/FY10.”
“It will continue to focus on its core competency of township development but at the same time, lay foundations for a big improvement in profits over the longer term from two fronts – commercial-type properties in the Klang Valley and overseas contribution from Vietnam and China,” it said.
The company said that in 2009, the strategies of most developers were to delay the opening of new projects, consolidate business activities and change the product mix.
“Now, most developers appear optimistic about longer-term prospects and are willing to take on more risks.”
Adzman Shah Mohd Ariffin, the Deputy Managing Director at DTZ Nawawi Tie Leung Property Consultants Sdn Bhd, said the new projects in Klang Valley this year will focus more on high-end properties in well-established locations such as the Jalan Tun Razak corridor, the KL City Centre/Golden Triangle, Mid Valley/Seputeh and Mont’ Kiara/Sri Hartamas.
He also said that landed properties will still be constructed, but as land becomes scarce in KL, the preference for low-density boutique developments will increase.
“Features such as better security, individual pools, greenery, panoramic views and aesthetic designs will continue to be incorporated in the developments,” he said.
“Prices will continue to be tested at increasingly higher levels but will largely depend on the positioning of the products and the performance of the first phase launched in the last three months,” Adzman added.
Adzman explained that innovative packages like low down-payment and stretched installment periods offered by property developers, coupled with attractive rates from financial institutions will spur buying activities.
“As long as the base lending rate stays at its current level, the market is expected to remain active albeit at a slower rate unless the economic recovery is expedited.”