Property Market Report 2013: Residential segment transactions down 9.7%, value up 6.3%

KUALA LUMPUR: The residential property sub-sector retained its lion’s share of the property market last year, accounting for 64.6% share in volume and 47.3% in value, according to the Property Market Report 2013 by the National Property Information Centre (Napic).

Last year, a total of 246,225 residential properties were transacted valued at RM72.06 billion. This was 9.7% lower in terms of volume although the value rose by 6.3% from the previous year.

The residential sub-sector saw a slight decrease in sales of new launches, but managed to reduce its overhang numbers and recorded higher housing starts and completions.

Prices of houses continued to rise, with the All House Price Index increasing to 192.9 points from 172.8 points in 2012.

In terms of volume, most states recorded a downturn in market activity except Johor, which recorded 16.6% growth. Putrajaya topped the list, with a 41.7% decline.

As for market share, Selangor outnumbered other states, contributing 26.1% or 64,269 transactions of the country’s residential transactions. Johor came second at 13.7%, with 33,651 transactions.

In terms of value, with the exception of Kuala Lumpur which contracted by 9.7%, other major states recorded growth last year. Johor recorded the highest growth of 63.2%, while Selangor saw a small growth of 2.8% and Penang was flat.

The year also saw transactions of lower price range softened. Transactions of houses within the price brackets of RM100,000 to RM150,000 and RM150,001 to RM200,000 declined 26.6% and 17.9% respectively, while those of houses priced from RM250,001 to RM300,000 increased by 23.2%.

But houses priced between RM100,001 to RM300,000 were the most sought after, capturing the largest share with 42.9% or 105,726 transactions.

Terraced houses were the most popular, contributing 38.8% or 95,536 units of residential transactions.

Condominium or apartment units were the next most sought after, with 13.6% or 33,510 units of the total transaction in 2013. Selangor and Kuala Lumpur together accounted for 70.4% of condominium or apartment transactions.

Last year recorded 48,617 units of new launches and the sales performance contracted to 45.1%, with the number of units sold lower at 21,904 units.

By property type, the largest share came from terraced units which took up 47.8% of the national total comprising 9,980 units of single-storey terraced houses and 13,273 units of two- to three-storey terraced houses.

Kuala Lumpur, Selangor, Johor and Perak were the main contributors of new launches. Collectively, these states offered 57.4% of the nation’s total new launches, relatively lower than recorded in the previous year at 62.1% (35,498 units).

Meanwhile, the overhang volume reduced to 13,547 units, down considerably by 10.2%. However, value increased marginally by 1.3% to RM4.80 billion.

Johor retained the highest number of overhang units in the country with a slight increase of 0.7% over last year in terms of volume and 8.6% in value.

Additionally, the unsold under construction and not constructed were on the upward trend. The unsold under construction and not constructed recorded an increase of 3% and 11.7% respectively. In the unsold under construction, Johor led with 11,807 units or 27.8%. Selangor followed suit with 10,185 units, increased by 6.4%.

On the supply front, residential property completions increased by 8.3% to 78,265 units last year from 72,247 units in 2012. Starts construction increased by 5.6% to 146,167 units last year from 138,407 units in the previous year. Likewise, new planned supply grew by 5.8% to 151,339 units. By state, Selangor spearheaded the completions and starts categories with 24.3% and 22.4% respectively.

For new planned supply, Johor, Selangor and Penang were “vigorous” with 28.8% (43,572 units), 16% (24,229 units) and 13.3% (20,169 units) of the country’s total, said Napic.

As at end of last year, there were 4.72 million existing residential units with another 696,557 units in the incoming supply and 615, 851 units in the planned supply.


This article first appeared in The Edge Financial Daily, on April 23, 2014.