By Melissa Chi
April 20, 2011
Labourers work at an apartment building under construction in Kuala Lumpur in this file photo of July 23, 2009. — Reuters pic
KUALA LUMPUR, April 20 — Residential property continued to dominate the overall property market in 2010, with 60.2 per cent of the total volume, according to the Property Market Report 2010.
The year saw 226,874 residential property transactions worth RM50.65 billion, 47.1 per cent of the total value of transactions.
The report prepared by the National Property Information Centre (NAPIC), a programme under the Valuation and Property Services department (JPPH) of the Ministry of Finance, was launched here today at the WISMA BSN.
The report said that the property market grew more than 15 per cent in the first two quarters, and continued to grow, although at a lower 8.5 per cent and 4.8 per cent in the third and fourth quarter respectively.
It has credited the positive growth to the measures and implementation of the two economic stimulus packages, amounting to RM67 billion.
There were 376,583 transactions registered in 2010 with a total worth of RM107.44 billion.
In terms of volume, the report said the highest increase of 22.1 per cent was recorded by industrial sub-sector.
By market share, the residential sub-sector continued to dominate with 60. 2 per cent, and by value, the development land sub-sector led with 53 per cent.
For residential properties, there was a 7. 2 per cent increase in volume and 21 per cent in value, compared with 2009.
Against 2009, the report said Putrajaya charted the highest increase in market transactions of 76.6 per cent, while in contrast, Labuan recorded a decrease of 21.3 per cent.
In terms of pricing, the Malaysian All House Price Index surged by 8.90 points to 140.7 points.
The price of an “average house” moved from RM184,574 to RM199,636 in the fourth quarter.
The report said that Kuala Lumpur had the highest price level in the country at RM430,163, followed by Selangor, at RM301,443, and Sarawak, at RM253,391.
It also said that houses priced below RM150,000 has the most demand with 57.1 per cent of transactions.
Units priced between RM250,000 and RM500,000 were the second most active price bracket, it said, accounting 14.9 per cent of the market activity.
As for high-end housing units above RM500,000, it’s market share moved upward to 16,782 transactions, with Selangor accounting for 7,726 transactions.
The report noted that terraced houses were the most sought-after house type with 36.3 per cent of transactions, followed by condominiums or apartments, and low-cost houses.
“The July and August increases in average lending rate (ALR) had partly contributed to the decline in sales performance of the residential new launches,” it said.
It also said that the average sales performance decreased to 45.7 per cent from 48 per cent.
There are signs of the market slowing down as construction activity in the residential sub-sector showed the “cautious behaviour” of developers, the report noted.
“The review period witnessed 95,938 completions compared with 103,335 units registered in 2009. Housing units, which began construction decreased marginally by 2.9 per cent to 84,210 units. Similarly, new planned supply reduced by 5 per cent to 76,306 units,” it said.
As for industrial properties, Selangor remained the nation’s largest contributer with 3,123 transactions, followed by Johor with 1,518 transactions.
Despite increased tourist arrivals, a 4.2 per cent growth against 2009, with a total of 24.6 million arrivals, the leisure sub-sector showed a lacklustre performance.
The report said that the average occupancy of three to five-star hotels declined to 53.1 per cent compared to 55.6 per cent from the year before, while the occupancy rate of all stars rated hotels also experienced downward trend to record 54.5 per cent.
As for the outlook of the year, NAPIC said the property market is anticipated to remain promising, supported by various measures proposed under the 10 Malaysia Plan (10MP) and 2011 Budget.
Apart from the implementation of the 12 National Key Economic Areas (NKEA), projects under the Economic Transformation Programme (ETP), public-private partnerships (PPP) projects, and the RM1 billion Facilitation Fund, there will also be commencement of “high-impact strategic development” such as the Mass Rapid Transit (MRT) project in June this year, the report highlighted.
“In the long term, the property sector should benefit form these projects. As new areas open up and new communities materialise, this will likely push up demand for housing and other facilities.
“The implementation of infrastructure projects in these regions is expected to spur new growth areas and hence activate local property market,” it said.
NAPIC also anticipates housing aid schemes to drive residential construction activity this year.
“The market will further be supported by the magnitude of the projects and the government’s strategic measures via its public-private partnership (PPP) initiatives. However, it is pertinent to note that the unrest in the Middle East countries are expected to cause an upward movement in oil prices and thus affecting the world economy.
“Subsequently, these may cause some impacts to the Malaysian property market,” it cautioned.