Mah Sing on lookout for land in prime areas

KUALA LUMPUR: Mah Sing Group Bhd is on a buying spree to acquire land banks that can generate a gross development value (GDV) of RM5 billion this year.

Its group managing direc-tor and group chief executive, Tan Sri Leong Hoy Kum, said the company has ac-quired land with a total GDV of RM3.62 billion so far and is on the lookout for land banks that can give it a yield of at least RM1 billion.

"We are definitely on the lookout for land banks in prime areas such as Klang Valley, Penang, the Iskandar region in Johor and in Sabah," he told reporters after the companys extraordinary meeting at its headquarters, yesterday.

He said the company would redesign its housing concepts to include more townships that have plenty of affordable homes.

"This does not mean that we are doing away with the luxury concept but we have to listen to what the market wants and they want affordable homes," he said.

He said so far, Mah Sing had purchased three pieces of land this year in Rawang (RM41 million), Sabah (RM80.5 million) and soon, a parcel of land in Bangi for RM333.3 million.

"We are looking at building homes that will be priced below RM1 million and that will comprise mainly the types of homes that we are planning to build in the future," he added.

He said during yesterday's meeting, the shareholders had approved the acquisi-tion of the Bangi land meant for the SouthVille city township, which will kick-start next year.

The SouthVille city will be on a 166.7-hectare site and expected to be completed in the next eight years, starting from next year.

"We plan to have a range of affordable units that will include small office-home office units (Soho), affordable link homes and lifestyle suites priced from RM208,000 to RM530,000.

"We will start work on this project in the third quarter of next year and the first phase will be the affordable range that will be completed by 2016," he added.

By Business Times

US home construction rebounds in August

New home construction in the United States rebounded in August from a July decline as the distressed housing market slowly continues to stabilize, government data released Wednesday showed.

Housing starts rose 2.3 percent from July to an annual rate of 750,000, the Commerce Department said.

The July rate was revised lower, to 733,000 from an initial estimate of 746,000.

The August pace in housing starts was a bit weaker than expected, with the consensus estimate at 770,000, but was 29.1 percent above the August 2011 rate.

Starts on single-family homes, the largest segment of the market, jumped 5.5 percent.

New building permits, an indicator of potential future homebuilding, were at an annual rate of 800,000, down 1.0 percent from July, the Commerce Department said. Permits were 24.5 percent higher than a year ago.

"August starts and permit numbers were so-so, but the broader trends suggest that the US housing recovery is solidifying," said Robert Kavcic at BMO Capital Markets.

Optimism among home builders rose to its highest level in more than six years in September, the National Association of Home Builders said Tuesday.

The NAHB/Wells Fargo sentiment index rose for a fifth straight month to its highest reading since June 2006.

"Builders across the country are expressing a more positive outlook on current sales conditions, future sales prospects and the amount of consumer traffic they are seeing through model homes than they have in more than five years," said NAHB chief economist David Crowe.

By AFP

US housing market recovery gains traction

The recovery in the US housing market continues to gain traction, data released Wednesday showed, a key improvement in the struggling economy just seven weeks before the presidential election.

With the economy dominating a tight race between President Barack Obama and Republican rival Mitt Romney ahead of the November 6 vote, signs of life are welcome in the housing sector, where millions of Americans have tied up their savings.

A pair of August housing data releases Wednesday further cemented the rough road back from a 2006 price bubble, analysts said.Existing home sales jumped 7.8 percent from July, the highest pace since May 2010, and were up 9.3 percent from a year ago, and prices increased the most in more than six years, the National Association of Realtors said.

The median price for all housing types, including single-family homes, apartments and townhouses, rose to $187,400 in August, up 9.5 percent from a year ago, the NAR said.

That was the strongest year-on-year price increase since January 2006, just before the market collapse that drove the world's biggest economy into the severe 2008-2009 recession.

"The US housing recovery is for real," said Sal Guatieri, senior economist at BMO Capital Markets."Great affordability, pent-up demand and strong investor interest in rental units are driving the market, and QE3 can only help by reducing mortgage rates further.

"A separate report from the Commerce Department showed housing starts rose 2.3 percent from July, and were up 29.1 percent from the August 2011 rate.

Starts on single-family homes, the largest segment of the market, jumped 5.5 percent.New building permits, an indicator of future homebuilding, fell 1.0 but were 24.5 percent higher than a year ago, the department said.

The data came on the heels of a sharply brighter outlook in the housing construction sector.

The National Association of Home Builders said Tuesday its NAHB/Wells Fargo sentiment index rose for a fifth straight month to its highest reading since June 2006.

"Builders across the country are expressing a more positive outlook on current sales conditions, future sales prospects and the amount of consumer traffic they are seeing through model homes than they have in more than five years," said NAHB chief economist David Crowe.

The US central bank last week rolled out its biggest stimulus in two years, QE3, in part to boost home building and buying, and fight high unemployment in the aftermath of the Great Recession.

Federal Reserve Chairman Ben Bernanke said the QE3 program -- purchases of mortgage-backed securities at a pace of $40 billion a month -- should help lower interest rates, particularly on mortgage rates which have been hovering at historic lows.

QE3 "should provide further support to the housing sector by encouraging home purchases and refinancing," which in turn would "help the economy grow," Bernanke said.

Barclays analyst Michael Gapen cautioned that the housing recovery still faced significant challenges.

"Our view is that housing is in a recovery phase, but one that will be restrained by the availability of credit, the pace of improvement in labor market conditions, and the overhang from distressed and foreclosed properties," he said.

By AFP