/// East Malaysia Property News
Property Deals Drop, Value of Transactions
Rise, Prices May Rise
Bank of China Can Provide Loans to
Developers in Sabah
real property gains tax
(RPGT), however, will
have little effect on
curbing speculative
activities in the market.
He said the RPGT
should have been
introduced earlier
when house prices
were lowerand prices
had appreciated faster,
resulting in higher profit
margins.
Luxury property buyers at PH Expo Kota Kinabalu
Property transactions
dropped in the first
nine months of last
year, said the Valuation
and Property Services
Department, confirming
observations by real
estate professionals
that the market is
slowing down.
Although the number of
transactions was lower,
there was an upward
trajectory in value, an
indication of rising
prices.
The department’s
deputy director-general
Faizan Abdul Rahman
said the residential subsector, which accounted
for about 64% of
the total property
transactions, saw a
14% drop from a year
earlier, with average
house prices exceeding
RM300,000.
Faizan was speaking
at the 7th Malaysian
Property Summit
2014 organised by the
Association of Valuers,
Property Managers,
Estate Agents and
Property Consultants
yesterday.
Faizan said the
commercial sub-sector
saw a drop of 22.3%,
compared with the
previous year.
The industrial,
agricultural and
30
development subsectors saw reductions
of about 20%, 13.6%
and 8.3%, respectively.
The total number of
transactions for the
first nine months fell
to 280,820 valued
at almost RM106bil,
compared with 328,692
in 2012 worth RM107bil.
Transactions in 2010
surpassed the RM100bil
mark as a result of an
extremely buoyant
market, which started in
2009. It has been on an
upward trajectory since
then.
On the effect of the
various tightening
measures, organising
chairman Choy Yue
Kwong said they
would curb excessive
speculation.
Choy, who is Rahim and
Co (Selangor) Sdn Bhd
managing director, said
the measures would
discourage speculators
from using bank
loans to finance their
purchases.
“The curbs are slowly
taking effect. The
measures will have a
significant impact on
speculation, especially
speculators who
depend on bank loans,”
he said.
Choy added that the
www.PropertyHunter.com.my
Prices had skyrocketed
now, squeezing profit
margins and rendering
the RPGT less effective,
he added.
CH Williams Talhar
& Wong Sdn Bhd
managing director Foo
Gee Jen, meanwhile,
said there was a
mismatch between the
demand for real estate
and supply.
“There is an oversupply
of high-end residential
property in the market.
Prices have gone up
too much over the last
few years. What people
really need is affordably
priced lower-to-midrange housing,” said
Foo.
“Developers will be
pressured to cater to
this market segment
that is most in need.
Having said th at, the
bright side is that the
market is expected
to stabilise with more
realistic prices over the
year.”
Sabah Housing and Real
Estate Developers Association
(SHAREDA) president Francis
Goh has urged the Bank of
China to set up a branch here
in order to provide loans for
developers to build better
five-star hotels and high-end
leisure properties.
Goh said, “I hope that the Bank
of China will set up a branch
soon so that we can develop
Sabah into a tourism haven,”
adding that Bank Negara
doesn’t encourage commercial
banks to approve loans for
developers or investors who
want to build hotels, deeming
the investments as high-risk
ventures.
Goh pointed out that the
resorts in Sabah should be six
to seven stars when compared
to five-star resorts in Kuala
Lumpur.
He said resorts in Sabah are
built on land no less than
300 to 700 acres. And more
developers should venture into
leisure property development
in the future.
“In line with the vision of Sabah
government to turn stretches
of long white sandy beaches
along the west coast up to the
Tip of Borneo under the Sabah
Development Corridor for
tourism development known
as Kinabalu Gold Coast, Sabah
shall excel and will soon take
over Bali or Langkawi of the
development trend for leisure
properties can be propelled,”
he said.
Goh also suggested China
entrepreneurs to acquire
high-end properties that are
only available here if they wish
to invest. For instance, Peak
Condominium with sea view
along Likas Bay which is priced
at RM750 per sq ft.
Goh said the land within three
km radius from the city centre
now cost between RM300
and RM400 per sq ft, meaning
that an acre of land within
that radius would be between
RM12 million and RM16 million.
He said buyers would find
it hard to look for luxury
condominiums close to the city
in five years’ time as developers
would not be able to find these
type of land.
Goh added that investing in
commercial shoplots was also
a viable option as the price had
surged in recent years.