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Buyers moving away from ‘wait-and-see’ approach

KUALA LUMPUR: Most local property developers have had to tighten their belts to weather the storm of the global recession but most were also able to maintain their footing, thanks to lessons learnt during the 1997 Asian financial crisis. To gauge how the current global slowdown has affected the local housing market, a report from the National Property Information Centre (NAPIC) looked at the performance of new housing launches from 4Q2008 to 2Q2009, a period of nine months. It focused on four areas: Kuala Lumpur, Selangor, Johor and Penang.

In Kuala Lumpur, a total of 2,389 units were launched in the nine-month period. Out of this, 994 units were sold, which represent a take-up rate of 41.6%. The remaining 1,395 units (58.4%) were unsold, with 299 (21.4%) comprising under-construction units, while the remaining 1,096 (78.6%) were made up of units yet to be constructed.

Selangor had the highest number of houses launched in the past nine months (3,983 units). A total of 1,977 units (49.6%) were taken up in the nine months but 2,006 units (50.4%) were unsold. A total of 1,378 (68.7%) of the unsold comprised of under-construction units, while 628 (31.3%) were units yet to be constructed.

In the south, Johor saw 2,619 houses launched during the 4Q2008 to 2Q2009 period. Of this number, 805 (30.7%) were sold by end-2Q2009, leaving a surplus of 1,814 units. A total of 877 (48.3%) of the unsold units were under-construction and 937 (51.7%) were made up of units yet to be constructed.

Penang featured the lowest number of house launches at 1,202 units and only 211 of these (17.5%) were sold. Of the remaining 991 (82.4%), 609 units (61.5%) were under construction and 382 (38.5%) were made up of units yet to be constructed.

The NAPIC report reveals that supply outstripped demand, and although the property market has seen a surge in buying at various launches lately, they have mostly been concentrated in the Klang Valley. It is still not clear if the oversupply will cause problems for developers who are planning launches in the coming months, but the positive sentiment has so far shown a move away from a the “wait-and-see” approach by most buyers, with many putting their money in assets with capital appreciation that is higher than current interest rates.

For more details on the report, visit www.jpph.gov.my.

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