Jalil-Damai

Secondary market remains strong

THE Penang secondary property market continues to perform well as developers hold back launches due to new and unbudgeted infrastructure charges, says Raine & Horne International Zaki + Partners Sdn Bhd director Michael Geh in presenting the Penang Housing Property Monitor for 3Q2014.

“Activity in the market is limited to people who really need to buy a house … Short-term investors, speculators and flippers have left the market, allowing serious long-term players to come in,” he says.

Based on National Property Information Centre figures, Geh points out, secondary transactions accounted for 84% of the market last year while newly launched products made up only 16%.

He also highlights that developers have been hit by a new infrastructure charge that he noticed being implemented at the beginning of the year, resulting in some of them holding back their launches and most likely adjusting their selling prices. “Developers have to pay an infrastructure charge of about RM15 psf on the gross area. Some of them will have to pay maybe RM3 million to RM7 million extra up front. This is an unbudgeted expense.”

Thus, the primary market may soften in the coming months while the secondary market keeps climbing steadily. Read more

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What’s in 2015?

For the past year, those vested have painted a bullish and rosy picture of the property market. To those who had a good run these past few years, congratulations. For those who are still dreaming of owning their own home, don’t worry. You will find your dream home soon. You may take your time because prices will taper a bit.

Malaysia’s property sector cooled off last year following the introduction of the government’s property cooling measures under Budget 2014, according to REHDA and government data.

Based on the property industry survey for 1H 2014 conducted by Malaysia’s Real Estate and Housing Developers’ Association (REHDA), nearly 90 percent of home builders across the country saw a slowdown in sales due to the government’s curbs.

In fact, affordable residential units priced below RM1 million were hard to sell as buyers were struggling to obtain housing loans.

Also, there is a lack of demand for bumi properties in locations where bumiputras do not traditionally reside while more than 80 percent of the respondents had a ‘neutral’ and ‘pessimistic’ outlook for Malaysia’s real estate sector for 1H 2015. Read more

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ISKANDAR MALAYSIA: Strangers in own land?

Iskandar Malaysia is seeing the formation of a housing bubble as a result of Chinese developers that have been flooding the property market with masses of projects.

According to Kenanga Research property, things are moving very slow at the corridor especially with houses which are selling above RM600,000. Slowdown can be seen in Iskandar Malaysia if there is an oversupply, coupled with the slew of government measures being implemented, interest rate hikes, low income growth, affordability and capital gain tax.

For example, to curb property speculation, the Singapore government implemented measures such as increasing the buyer’s stamp duty, sales tax and initial down-payment. Prices actually moderated and then fell, as the Singapore URA Residential Prices Index fell 3.2% from September 2013 to June 2014. However, the same trend happening in Malaysia where in the mid to near term, we could see limited upside potential and a lack of diversification for property investments.

For property developers, Iskandar Malaysia remains a hugely lucrative market. Projects keep mushrooming throughout the area as developers launch their prized, high-end houses to a crowd of waiting buyers, specifically foreigners.

What policy makers are concerned about won’t be the million dollar plus homes being built for rich Malaysians and foreigners but the concerned is how Malaysians will be able to fork out an ever-increasing percentage of their monthly take-home pay to purchase a slice of a humble Malaysian dream. Read more

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Secure investment portfolio via property ROI

Return on investment is a crucial analytical tool used by both businesses and investors and it’s a key concept for any investor to understand. ROI answers the question “how much will I get back per dollar I invest?” Real estate investments are one of the most secure types of investing nowadays. We all know that stocks and bonds can be badly affected by recessions, as we had experienced during 2008.

Owning rental property has been a popular investment for many over the years. The difference between an investment property and your own home is that you earn an income from it. You can earn profit in real estate in either of three methods: acquiring, selling, and renting it out.

With regards to “where” your properties should be located, there are some factors to consider. Basically what you have to consider about it would be the type of property that you have, its size and how much you manage the property.

WHAT TYPE OF PROPERTY SHOULD YOU PUT YOUR INVESTMENT ON?

Commercial leasing spaces such as office and warehouse units, or should you choose to buy an apartment? As far as cash flow is concerned the best property to buy would be apartment buildings. There are several factors which makes it the best property to acquire and not something else. Read more

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Price Range Of Unsold Unit

unsoldTHERE seems to be a Catch-22 situation in the property market as more developers plan new launches in the second half of this year (2H14), knowing that demand remains solid, and yet may end up accumulating more unsold units going forward.

Many property players have been holding back their launches in the first half (1H), banking on homebuyers’ rush to buy in the face of the Government’s imminent Goods and Services Tax (GST) implementation in April 2015.

Market experts, however, believe the sector does not have to worry about a Catch-22 situation.

CB Richard Ellis (M) Sdn Bhd executive director Paul Khong says that with nominal Government intervention, the property market will automatically find its own equilibrium.

“No private developer will continue to build if demand does not exist. With the market doing fairly well, developers are pushing harder for sales with various incentives,” he says, touching on how players are adapting to the environment the best they can.

Khong notes that the market has had a quiet start in 2014, as forecast earlier, due to various tightening measures taken by on the Malaysian property market through Budget 2014. Read more

Digital Image by Sean LockeDigital Planet Designwww.digitalplanetdesign.com

Malaysia Property Agent Fees

Digital Image by Sean LockeDigital Planet Designwww.digitalplanetdesign.comAs property agents are instrumental in helping you deal with the massive task of sourcing, acquiring and handling the paperwork for a property, it is only fair that they receive proper remuneration for their work.

Unfortunately, as many property seekers have attempted to subvert or get themselves out of having to pay a fair amount –and some estate agents who have been less than honest in their calculation for payment – the official government body, The Board of Valuers, Appraisers and Estate Agents Malaysia have established a rule on the fees payable.

For a sale or purchase of land, buildings as well as joint ventures, sale of company and property swaps, a maximum fee of 3% is imposed.

For chattels (personal property such as furniture, tools, etc.) including machinery, 10% of the proceeds is payable to the agent. This is a flat amount.

Any sale or purchase that occurs by way of tender, private treaty or any other mode of disposal or acquisition will adhere to the above rules.

Should you acquire an estate agent for sale and marketing projects however, the fees payable are not governed by the official body and are instead to be agreed between the client and the estate agent.

Furthermore, these fees do not apply to the sale of foreign properties in Malaysia or the sale of Malaysian properties on foreign soil. Read more