Rehda survey shows property market gradually returning to normalcy

• While developers are currently maintaining a neutral view on the business, economic and property industry outlook for the coming year, there is increased optimism anticipated for 1H2024.

PETALING JAYA (Aug 17): There has been an increase in activity in the real estate market in Malaysia, based on the recent Real Estate and Housing Developers' Association (Rehda) Property Industry Survey for 1H2023 findings.

The survey results, based on input from 148 member developers, showed both new launches and sales performances recording a hike compared to 2H2022 results. 

In presenting the findings during the media briefing at Wisma Rehda in Kelana Jaya today, Rehda president Datuk NK Tong said a total of 14,392 residential units were launched in 1H2023, indicating a 50% increase from 2H2022. Most of it were apartments or condominiums (7,183 units) followed distantly by 2 to 3-storey terraces and serviced residences (3,729 and 1,223 units respectively).

As for residential sales performance, 11,273 units in total were sold in 1H2023 and 35% of these units were from the new launches. Apartments or condominiums performed the best at 3,749 units, with serviced residences at a close second (3,688 units) followed by 2- to 3-storey terraces (2,040 units). 

“The increase in the number of launches and sales is a positive sign towards a property market that is slowly returning to normalcy,” says Tong. 

True recovery hampered by challenges

“However, true recovery is still out of reach as developers are still struggling with challenges that have yet to be properly addressed such as material price hike, cross-subsidisation as well as high compliance and utilities costs,” he adds.

As per the survey, almost 75% of the participants reported an average of 15% increase in their overall cost of doing business in 1H2023, as opposed to 13% in the previous half. 

Additionally, 84% of the participants reported being impacted by the current economic conditions. Consequently, they have opted to take cost-cutting measures in terms of operations (freezing recruitment, offering less benefits and perks as well as reduction of salaries) and production/delivery (rescheduling launches of planned projects, reducing scale of launches and delaying projects because of poor demand).

More than half plan to launch before year ends

Despite the challenges, 53% of the participants are planning to launch their projects in 2H2023, based on Rehda's Market Outlook for 2H2023 and 1H2024. However, approximately 75% of them anticipate their sales performance to be at 50% and below. 

The majority of these planned launches are priced between RM150,001 and RM300,000, particularly in the states of Kedah, Perlis, Melaka, Pahang, Penang and Perak.

While developers are currently maintaining a neutral view on the business, economic and property industry outlook for the coming year, there is increased optimism anticipated for 1H2024, according to the market outlook report.

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