Property market to perk up next year

PETALING JAYA: More activities are expected in the property market next year when buyers’ confidence returns and more projects come onstream, industry players said.

According to Real Estate and Housing Developers Association (Rehda) president Datuk Ng Seing Liong, the local market has not been much affected by the US subprime loans debacle and the global financial meltdown.

“Although the market has been rather quiet with fewer project launches, property prices are sustained at previous levels. Developers are being extra careful and are deferring new launches because of the prevailing weak market sentiment,” Ng told StarBiz.

To help stimulate greater buying interest, he said Rehda had urged the Government to provide incentives such as a a one-time grant of RM10,000 and full stamp duty exemption to first-time house buyers and to allow interest paid on housing loans be offset against personal income in income tax calculation.

Ng said the Government’s decision to invite the private sector to participate in developing government land through open tenders would open up new development opportunities for industry players.

SP Setia Bhd group managing director Tan Sri Liew Kee Sin concurred that the Government’s economic stabilisation plan to kick-start priority projects would pump prime the economy and create more confidence in the market.

“Malaysia is in a good position to withstand the global financial crisis. Our financial institutions are well insulated against the global financial meltdown as they have learned well from the last regional financial crisis,” he said.

One way for developers to ride out the current challenging market conditions is to create demand for their products. “That calls for more creative product development and marketing strategies,” Liew said. “Of course, having a broad product base and good geographical spread will also help to mitigate a slowdown in any particular sector.”

Mah Sing Group Bhd group managing director and chief executive Datuk Sri Leong Hoy Kum said that while the outlook was challenging, projects by branded developers would still do well.

“It all depends on the marketability of the products, as well as the supply and demand dynamics in the area. There will always be pent-up demand for housing as it is a fundamental necessity. For developers, it is a matter of good concept and product, location, branding and timing.

“We believe a lot of developers will start launching projects early next year as material prices will come down further in the next six months,” he added.

For this year, Mah Sing is scheduled to launch a substantial amount of properties worth about RM614mil, with a sales target of RM560mil.

Leong said the company’s edge was that it had pre-constructed a lot of its properties last year at old construction costs, and today, the buyers could enjoy the completed or soon-to-be-completed properties at very competitive prices.

Meanwhile, Sunway City Bhd (SunCity) managing director for property development Ngian Siew Siong said developers were more prudent and managing their cash flow better after learning from the lessons of the last financial crisis.

“SunCity is looking at attracting more foreign buyers, especially en bloc sales to South Koreans, Japanese and Chinese buyers. These are mainly for medium to high-end residences priced from RM500,000 to RM600,000.

“The company’s unbilled sales of close to RM1bil will be realised over the next two years. This is also a good time to look at clearing the unsold stock.”

Ngian said “clearer directions” would emerge after the first quarter of next year after the power transition in Umno and the Cabinet reshuffle.

By The Star (by Angie Ng)