By Kent Tan
The latest report published in Malaysia Property Market 2014 has shed some positive light on the market, which has been restrained by anti-speculation measures.
There is a slight increase in the property sector, marking a marginal growth of 0.8 per cent in market volume and 13.5 per cent in market value. The marginal rebound was from -10.9 percent recorded in 2013. In 2014, a total of 384,060 transactions worth RM162.97 billion was recorded.
The construction sector has marked 11.6 per cent expansion compared to 10.9 per cent in 2013. Loans approved for the sector has also charted a marginal 0.3 per cent growth compared to -10.5 per cent in 2013 whilst loans disbursed continue to grow 12.7 per cent (14.8 per cent in 2013).
The key contributor to the growth came mainly from the residential sub-sector, constituting 64.4 per cent; followed by agricultural, 18.8 per cent; commercial, 9.3 per cent; development land, 5.5 per cent; and industrial, 2.1 per cent.
In the leisure sub-sector, Kuala Lumpur retained its ranking among the top 10 most-visited cities in the world, according to Master Card Global Destination Cities Index 2014. Tourists number 22.9 million for the first 10 months of 2014, marking an annual increase of 9.6 per cent. Under the performance for the sub-sector, the average occupancy rate of one to five star hotels registered 53.5 per cent compared to 50.8 per cent in 2013.
In terms of value, residential took the lead with 50.4 per cent; followed by commercial, 19.5 per cent; development land, 13.3 per cent; industrial, 8.9 per cent; and agricultural, 7.8 per cent.
Movements in volume of transactions remain insignificant, where residential, commercial and agricultural recorded growth of 0.4 per cent, 3.6 per cent and 2 per cent respectively. Industrial and development land recorded a downturn of 3.8 per cent and 1.9 per cent respectively.
The key player, residential sub-sector saw a slight turnaround with moderate performance for new launches, improved overhang situation as well as positive trend in the construction sector. Prices and rentals remained firm though signs of price moderating were seen in the All House Index.
Residential sub-sector recorded 247,251 transactions worth RM82.06 billion, an increase of 0.4 per cent in volume and 13.9 per cent in value, accounting for 64.4 per cent and 50.4 per cent of the national market volume and value respectively.
Selangor, Johor and Perak remained the three leading states in the residential segment, contributing 24.6 per cent, 15.8 per cent and 11 per cent respectively. Overall, seven states recorded upward volume movements whilst nine states recorded downward. Selangor and Perak are among the states that recorded downward movement with 5.2 per cent and 3 per cent respectively. Johor and Penang remained on positive track with 15.9 per cent and 4 per cent respectively. All states recorded upward movement in terms of value, except Labuan, Pahang and Kelantan.
In terms of price, residential property priced RM200,000 and below as well as RM200,000 to RM500,000 have recorded similar performance, with 43.1 per cent and 41.3 per cent respectively. Over the past three years, the increasing volume trend in the latter bracket has matched the declining volume of the former price bracket. The brackets of RM500,000 to RM1 million and RM 1 million and above have increased by 23.2 per cent and 16.2 per cent respectively.
By type, terraced houses accounted for 41.1 per cent or 102,313 units of the total, followed by condominium and apartment with 12.6 per cent or 31,072 units.
68,351 units of new launches were recorded in 2014, up from 62,376 in 2013. High-rises formed 44.9 per cent of the new launches. Sales performance was recorded at 44.7 per cent, which is amongst the better performance over the five-year period. Selangor, Kuala Lumpur and Johor led in number of launches, recording 18 per cent, 17.4 per cent and 16.8 per cent respectively. Sales performance wise, Kuala Lumpur, Negeri Sembilan, Kelantan and Sabah secured more than 50 per cent.
In terms of category, launches consist of 49.7 per cent for landed and 49.6 per cent for high-rises. Landed units achieved 34.4 per cent take-up rate while high-rise scored 11.1 per cent. By type, terraced houses accounted for 37.7 per cent of the total launches and 36.9 sales performances, followed by serviced apartments with 27.8 per cent of total launches and 5.5 per cent sales.
Residential overhang has improved by receding to 11,816 units worth RM4.04 billion, down by 12.8 per cent in volume and 15.9 per cent in value. However, unsold under construction property increased by 6 per cent to 55,156 units and unsold not constructed units recorded 8.5 per cent growth to 15,227 units.
Johor remained the states with highest overhang units, accounting for 30.2 per cent. However, the number has reduced slightly by 0.2 per cent though value increased by 32.4 per cent to RM952.43 million. The states also has the highest unsold under construction and not under construction residential of 30.5 per cent and 40.8 per cent respectively.
Terraced houses accounted for 42.2 per cent or 4,974 units of the total where mostly are concentrated in Johor, standing at 43.9 per cent or 2,183 units. Condominium and apartments (1,530 units) and serviced apartments (919 units) contributed 20.7 per cent to the overhang total, mainly in Kuala Lumpur (746 units). Most overhang units are priced RM500,000 and above.
For unsold under and not under construction categories, the high-rises outnumbered terraced units with 49.4 per cent or 27,230 units for condominium and apartment category and 63.6 per cent or 9,685 for serviced residences.