First Auction Sdn Bhd’s Zaarif Zainal tells City & Country: “Apartments used to be quite hot, but to avoid the maintenance charges buyers now prefer landed residential properties.”
Besides the usual prime areas such as Taman Tun Dr Ismail and Petaling Jaya, demand for landed residential properties is also rising in Shah Alam, Puchong, Subang, Cheras, Kajang and Bangi, he says.
Auction Data Sdn Bhd CEO Gary Chia says 8% fewer properties were up for auction in January 2010 than in December 2009. Some 6,500 properties were up for auction nationwide in January, compared with 7,000 in December 2009, he says.
However, the number of landed properties that came under the hammer rose slightly, by 6%, to 2,750 in January.
The auction market for Klang Valley properties saw a spike in sales at the end of 2009, which spilled over into January. The unusually robust market was attributed to the initial announcement of the implementation of a 5% real property gains tax (RPGT) in Budget 2010.
First Auction’s Zaarif says the auction house has been busy since the beginning of November 2009, as bidders rushed to beat the implementation of the RPGT in January 2010.
“We had a 35% increase in sales in December over November,” he tells City & Country.
The principal of JJ Auctions Services, G Jayakumaran, said the company had a 10% to 20% increase in sales in December over the previous month.
“We are starting to see areas like Bukit Beruntung, Klang, Kajang and Cheras being sought after by bidders… could be due to the more affordable pricing of properties there,” Jayakumaran says.
On the effects of the RPGT, Zaarif says investors will definitely feel the pinch, as many who buy at auction hold the property only for the short term. Both Zaarif and Chia also expect the auction market to slow in February due to the Chinese New Year season.
City & Country randomly tracked some landed homes in the Klang Valley that were up for auction in December and January. All of them have a reserve price of RM250,000 and above.
Among notable properties that were sold in December 2009 and January 2010 are an intermediate 2-storey terraced house in Taman Connaught, Cheras, for RM300,000 at second auction; a 2-storey corner terraced house for RM400,000 in Kota Kemuning, Shah Alam, at first auction; and a 2-storey detached house in Section 13, Shah Alam, for RM1.65 million, also at first auction.
There are still no bids, meanwhile, for an intermediate 2-storey terraced house in Subang Jaya (reserve price of RM290,000), in its third auction.
This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 794, Feb22 - 28, 2010
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