Zeti: Property prices have to adjust

KUALA LUMPUR (Oct 31): Property prices will definitely have to adjust in the near term to cater to the softening demand, said Sime Darby Property Bhd's chairman Tan Sri Zeti Akhtar Aziz.

She said the current soft property market situation presents a window of opportunity for developers to work on improving the sector to prevent a potential collapse.

"We need to manage it well and effectively so we have the time to do it as [the sector] hasn't collapsed, it's just softened. So we have a window of opportunity to manage the property sector so we can come out of it well," she told reporters after chairing the group's first annual general meeting since being appointed three months ago.

She was responding to a question on whether property prices would drop, after Finance Minister Lim Guan Eng said yesterday that prices of new houses are expected to fall by up to 10% as the exemption of the sales and service tax on construction services and building materials costs kicks in.

Guan Eng said the reduction in prices can be expected on new houses that have not been built yet.

Moving forward, Zeti said the outlook for the property sector remains very challenging at the moment but is positive of a turnaround.

"We believe that we have the capabilities and resources to manage ourselves so that we ride out this challenging period and move into strategic areas in property development where there is demand and areas which would support the economy and the public at large," she said.

At the noon market break, shares of Sime Darby Property rose 0.5 sen or 0.54% to 92.5 sen, with 1.16 million shares done, for a market capitalisation of RM6.33 billion.

— theedgemarkets.com

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