Property perking up

Post date: Jun 18, 2010 11:50:28 PM

Monday January 11, 2010

By EDY SARIF

Affordability of residential properties at its all-time best

PETALING JAYA: The local property market is in for a brighter prospect this year as the economy is forecast to return to growth while prices are now at affordable levels.

A recent CIMB Research report said that due to moderate price appreciation, rising income and record low interest rates, affordability of residential properties in Malaysia was at its all-time best.

It said that for this year, developers such as E&O Property Development Bhd (E&O Prop) would focus on its maiden condominium venture at Seri Tanjung Pinang, 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 Prop would also work towards the launch of a new condo in Kuala Lumpur as its St Mary Residence project had already reached a critical milestone, with a combined take-up of 60% for the two blocks, it said.

“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 research house said that a year ago, most developers’ strategies were to hold off on new launches, consolidate their business activities and change the product mix to weather the storm.

“Now, most developers appear optimistic about longer-term prospects and are willing to take on more risks,” it said.

DTZ Nawawi Tie Leung Property Consultants Sdn Bhd deputy managing director Adzman Shah Mohd Ariffin said new residential launches in the Klang Valley this year would focus on mainly high-end properties in well-established locations.

These are the KL City Centre/Golden Triangle, Jalan Tun Razak corridor, Mont’ Kiara/Sri Hartamas and Mid Valley/Seputeh.

He said landed properties would still be sought after as land became scarce in and around KL city and increasing preference for low-density boutique developments.

“Features such as better security, individual pools, greeneries, panoramic views and aesthetic designs will continue to be incorporated in the developments.

“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 told StarBiz in an e-mail reply.

He added that innovative packages such as stretched instalment periods and low downpayment offered by developers, coupled with attractive rates offered by financial institutions, would continue to spur buying.

“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,” he said.

He added that the Government’s recent review of the real property gains tax would also help the secondary and sub-sale market.

Glomac Bhd said the company would launch new phases at its township this year but didn’t give details on when they would take place.

A spokesman said the new phases would be at Bandar Saujana Utama, Saujana Rawang and Sri Saujana (Johor Baru).

Gamuda Land Sdn Bhd told StarBiz that it would, at end-February, launch its second gated-and-guarded precinct, Ambang Botanic 2, at Bandar Botanic in Klang.

A company spokesman, in an e-mail reply, said the new project following its earlier Ambang Botanic 1 was prompted by the increasing demand for gated-and-guarded living.