Houses between RM400,000 and RM500,000 to be the focus in 2017

KUALA LUMPUR (Jan 18): This year will see all eyes — including property developers’ — on affordable housing priced between RM400,000 and RM500,000, said property consultancy firm CBRE | WTW.

The firm expects the overall property market to remain flat.

“From what I’ve seen in the last quarter of 2016, the flattish growth will maintain in 2017. The good thing is that developers will venture more into affordable housing developments.

“And if the government pushes hard enough [for affordable housing schemes], the transaction volume for residential properties will improve slightly where genuine demand will lead the market,” said CBRE | WTW managing director Foo Gee Jen at a press conference after the launch of the firm’s Asia Pacific Real Estate Market Outlook 2017: Malaysia.

“Total transaction value, however, will be lower. And when you factor in the retail and industrial sector, overall growth will still be flat,” he added.

Looking forward, infrastructure developments such as the Kuala Lumpur-Singapore High Speed Rail, the Light Rail Transit 3, and the Damansara Shah Alam Expressway will be among the key growth catalysts.

“[Infrastructure development] will open up many other development activities and areas,” said Foo.

On residential hotspots, he noted that due to land scarcity in KL city centre, high land cost and improved connectivity between townships, the upcoming property hotspots in the Klang Valley and Greater KL will be Nilai, Semenyih, Kajang, Putrajaya, Cyberjaya, Rawang, Ijok, Kuang, Sungai Buloh and Kuala Selangor.

Meanwhile, the Kwasa Damansara township, Bukit Bintang City Centre, Tun Razak Exchange, Merdeka PNB 118, Bandar Malaysia and the Malaysia External Trade Development Corporation developments will continue to drive growth in the commercial property sector.

“One of the most underrated sector, the industrial sector, will have strong growth this year, in view of improved infrastructure,” said Foo.

For Penang, Penang branch director Peh Seng Yee said for the next few years, Penang’s high-rise residential market will continue to be a buyer’s market, as there will be more new supply coming in, in 2017.

The cumulative supply of high-rise residential properties on Penang Island as at 2016 was 46,853 units while on the mainland, it was 7,766 units.

Meanwhile, the landed residential sector will experience slow growth, he said.

“The demand for landed houses in Penang is expected to stay firm, as landed homes are still the preferred housing product among Penangites,” said Peh, adding that the current cumulative supply of landed homes in Penang stands at 150,307 where 75% are on the mainland and the remaining 25% on the island.

“Over on the island, new launches will be focused on niche and high-end markets while on the mainland, new launches will be priced higher than those on the secondary market due to the incorporation of lifestyle features.

Meanwhile, the Johor residential market will continue to be a buyer’s market, according to Johor branch director Tan Ka Leong.

The existing supply for landed homes in Iskandar Malaysia is at 294,694 units with terraced houses taking up 83%. Another 13,584 units will come into the market in the next two years.

The high-rise residential market will soften further as there will be another 19,000 high-rise units coming in by end-2017. Existing supply is at 43,898 units, offered Tan.